Question

Aircard Corporation tracks the number of units purchased and sold throughout each accounting period but applies its inventory costing method at the end of each period as if it uses a periodic inventory system. The following are the transactions for the month of July.

		Units			Unit Cost
July 1	Beginning Inventory		2,000		$	20
July 5	Sold		1,000
July 13	Purchased		6,000			24
July 17	Sold		3,000
July 25	Purchased		8,000			26
July 27	Sold		5,000

	FIFO LIFO Weighted Average Cost Cost of Goods Available for Sale Ending Inventory Cost of Goods Sold

Answer 1

	FIFO	LIFO	Weighted average cost
Cost of Goods Available for sale	3,92,000	3,92,000	3,92,000
Ending Inventory	1,82,000	1,70,000	1,71,500
Cost of Goods Sold	2,10,000	2,22,000	2,20,500

Explanation:

Valuation Of Inventory using FIFO
		Cost of good available for sale			Cost of goods sold			Ending Inventory
		Units	Rate	Value	Units	Rate	Value	Units	Rate	Value
July 1	Begining Inventory	2,000	20	40,000
July 5	Sales				1,000	20	20,000
July 13	Purchases	6,000	24	1,44,000
July 17	Sales				1,000	20	20,000
July 17	Sales				2,000	24	48,000
July 25	Purchases	8,000	26	2,08,000
July 27	Sales				4,000	24	96,000
July 27	Sales				1,000	26	26,000
July 31	Ending inventory							7,000	26	1,82,000
Totals		16,000	24.5	3,92,000	9,000		2,10,000	7,000	26	1,82,000
Requirement b
Valuation Of Inventory using LIFO
		Cost of good available for sale			Cost of goods sold			Ending Inventory
		Units	Rate	Value	Units	Rate	Value	Units	Rate	Value
July 1	Begining Inventory	2,000	20	40,000
July 5	Sales				1,000	20	20,000
July 13	Purchases	6,000	24	1,44,000
July 17	Sales				3,000	24	72,000
July 25	Purchases	8,000	26	2,08,000
July 27	Sales				5,000	26	1,30,000
July 31	Ending inventory							1,000	20	20,000
July 31	Ending inventory							3000	24	72,000
July 31	Ending inventory							3000	26	78,000
Totals		16,000	24.5	3,92,000	9,000		2,22,000	7,000	24.29	1,70,000
Requirement c
Valuation Of Inventory using Weighted average Cost
		Cost of good available for sale			Cost of goods sold			Ending Inventory
		Units	Rate	Value	Units	Rate	Value	Units	Rate	Value
July 1	Begining Inventory	2,000	20	40,000
July 5	Sales				1,000
July 13	Purchases	6,000	24	1,44,000
July 17	Sales				3,000
July 25	Purchases	8,000	26	2,08,000
July 27	Sales				5,000
July 31	Ending inventory							7,000	24.50	1,71,500
Totals		16,000	24.50	3,92,000	9,000	24.50	2,20,500	7,000	24.50	1,71,500