Question

Exercise 6-4 Elsa’s Boards sells a snowboard, Xpert, that is popular with snowboard enthusiasts. Information relating to Elsa’s purchases of Xpert snowboards during September is shown below. During the same month, 317 Xpert snowboards were sold. Elsa’s uses a periodic inventory system. Date Explanation Units Unit Cost Total Cost Sept. 1 Inventory 68 $99 $ 6,732 Sept. 12 Purchases 118 103 12,154 Sept. 19 Purchases 52 109 5,668 Sept. 26 Purchases 131 105 13,755 Totals 369 $38,309 Compute the ending inventory at September 30 and cost of goods sold using the FIFO and LIFO methods. FIFO LIFO The ending inventory at September 30 $ $ Cost of goods sold $ $ LFor both FIFO and LIFO, calculate the sum of ending inventory and cost of goods sold. FIFO LIFO The sum of ending inventory and cost of goods sold $ $

Answer 1

First of all let’s calculate number of units in ending inventory;

Beginning inventory	68 units
Add: Purchasee (118 + 52 + 131)	301 units
Total units available for sale	369 units
Less: Sale	(317) units
Ending inventory	52 units

Now let’s calculate value of ending inventory under FIFO and LIFO;

	FIFO	LIFO
Ending inventory units	52	52
Per unit price for ending inventory	$105	$99
Value of ending inventory	$5460	$5148

Now let’s calculate value of COGS (Cost of goods sold) under FIFO and LIFO;

	FIFO	LIFO
Total value of units available of goods sold	$38309	$38309
Less: Value of ending inventory	($5460)	($5148)
COGS (Cost of goods sold)	$32849	$33161

Now let’s calculate sum of COGS (Cost of goods sold) and ending inventory under FIFO and LIFO;

	FIFO	LIFO
Value of ending inventory	$5460	$5148
COGS (Cost of goods sold)	$32849	$33161
Total	$38309	$38309