Compute ending inventory and cost of goods sold for the current year under FIFO, LIFO, and average cost inventory costing methods.

Penn Company uses a periodic inventory system. At the end of the annual accounting period, December 31 of the current year, the accounting records provided the following information for product 1:

Required

Expert Solution

	Units	Unit cost	Total
Inventory beginning	2000	5	10000
March 21 purchase	5000	6	30000
August 1 purchase	3000	8	24000
Total	10000		64000

Average cost per unit	6.4	=64000/10000

FIFO:
Ending inventory	30000	=(30008)+(4000-3000)6
Cost of goods sold	34000	=64000-30000

LIFO:
Ending inventory	22000	=(20005)+(4000-2000)6
Cost of goods sold	42000	=64000-22000

Average cost:
Ending inventory	25600	=4000*6.4
Cost of goods sold	38400	=64000-25600

ekkarill92 answered 3 years ago

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Compute ending inventory and cost of goods sold for the current year under FIFO, LIFO, and average cost inventory costing methods.

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