Question

Given the following information, determine the journal entries:    

(Note: When computing the cost of goods sold and ending inventory, please see Exhibits 5A.3, 5A.4 and 5A.5 to prepare a schedule to assist you in the computations. It is a good thing to show your computations in a schedule in case you make a mistake. I will give credit for the problem if it is set up properly and there is a math error as long as I can see the setup)

a. using the weighted average perpetual inventory method.

b. using the LIFO perpetual inventory method.

c. using the FIFO perpetual inventory method.

March beginning inventory is 5 units at $6 per unit.             

March 3: 15 units were purchased at $7 per unit.
March 11: 10 units were purchased at $9 per unit.

March 15: 20 units were sold at $15 per unit.

March 18: 35 units were purchased at $10 per unit.
March 31: 30 units were sold at $20 per unit.

Answer 1

Calculation of Ending Inventory: Weighted Average Cost
Date	Purchases			Sales			Balance
	Units	PU	Total Cost	Units	PU	Total Cost	Units	PU	Total Cost	PU
Opening Balance							5.00	6.00	30.00
												Weighted Average Cost
03-Mar	15	7.00	105				20.00	6.75	135.00	135/20		Opening Stock	30
												Add: Purchases	545
11-Mar	10	9.00	90				30	7.50	225	225/30		Less: Closing Inventory	142
												Cost of Goods Sold	433
15-Mar				20	7.50	150	10	7.50	75
18-Mar	35	10	350				45	9.44	425	425/45
31-Mar				30	9.44	283.33	15	9.44	142
Total	65		575	50		433	15		142
Calculation of Ending Inventory: LIFO
Date	Purchases			Sales			Balance
	Units	PU	Total Cost	Units	PU	Total Cost	Units	PU	Total Cost
Opening Balance							5.00	6.00	30.00
												LIFO
03-Mar	15	7.00	105				5.00	6.00	30.00			Opening Stock	30.00
							15	7.00	105			Add: Purchases	545.00
												Less: Closing Inventory	115
11-Mar	10	9.00	90				5.00	6.00	30.00			Cost of Goods Sold	460
							15.00	7.00	105.00
							10	9.00	90.00
15-Mar				10	9.00	90	5.00	6.00	30.00
				10	7.00	70	5.00	7.00	35.00
18-Mar	35	10	350				5.00	6.00	30.00
							5.00	7.00	35.00
							35	10.00	350.00
31-Mar				30	10.00	300.00	5.00	6.00	30.00
							5.00	7.00	35.00
							5.00	10.00	50.00
Total	65		575	50		460	15		115
Calculation of Ending Inventory: FIFO
Date	Purchases			Sales			Balance
	Units	PU	Total Cost	Units	PU	Total Cost	Units	PU	Total Cost
Opening Balance							5.00	6.00	30.00
												FIFO
03-Mar	15	7.00	105				5.00	6.00	30.00			Opening Stock	30.00
							15	7.00	105			Add: Purchases	545.00
												Less: Closing Inventory	150.00
11-Mar	10	9.00	90				5.00	6.00	30.00			Cost of Goods Sold	425.00
							15.00	7.00	105.00
							10.00	9.00	90.00
15-Mar				5.00	6.00	30.00	10.00	9.00	90.00
				15.00	7.00	105.00
18-Mar	35	10	350				10.00	9.00	90.00
							35.00	10.00	350.00
31-Mar				10	9.00	90.00	15.00	10.00	150.00
				20	10.00	200.00
Total	65		575	50		425	15		150