Question

Bonita Distribution markets CDs of the performing artist Unique. At the beginning of October, Bonita had in beginning inventory 2,000 of Unique’s CDs with a unit cost of $7. During October, Bonita made the following purchases of Unique’s CDs.

Oct. 3		2,500	@	$8		Oct. 19		3,000	@	$10
Oct. 9		3,500	@	$9		Oct. 25		4,000	@	$11

During October, 10,950 units were sold. Bonita uses a periodic inventory system.

Determine the cost of goods available for sale.

Cost of goods available for sale

$Enter the cost of goods available for sale in dollars

eTextbook and Media

Calculate cost per unit. (Round answer to 2 decimal places, e.g. 2.25.)

Cost per unit

$Enter the cost per unit in dollars

eTextbook and Media

Determine (1) the ending inventory and (2) the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average-cost). (Round answers to 0 decimal places, e.g. 1,250.)

		FIFO		LIFO		AVERAGE-COST
The ending inventory		$Enter a dollar amount		$Enter a dollar amount		$Enter a dollar amount
The cost of goods sold		$Enter a dollar amount		$Enter a dollar amount		$Enter a dollar amount

eTextbook and Media

Which cost flow method results in (1) the highest inventory amount for the balance sheet and (2) the highest cost of goods sold for the income statement?

(1)		Select a cost flow method                                                                      FIFOLIFOAverage-cost produces the highest inventory amount, $Enter a dollar amount  .
(2)		Select a cost flow method                                                                      FIFOLIFOAverage-cost produces the highest cost of goods sold, $Enter a dollar amount  .

Answer 1