Question

Periodic (FIFO, LIFO, Average)

Spring River sells bottled water using a periodic inventory system. The following is a list of beginning inventory and purchases for bottles used in manufacturing their spring water.

                        Beginning Inventory                           6,000 bottles at $0.20

                        First Purchase                                      4,500 bottles at $0.22

                        Second Purchase                                 5,600 bottles at $0.24

                        Third Purchase                                    2,000 bottles at $0.26

At the end of the year, 2,500 bottles remained in ending inventory. What is cost of merchandise sold and ending inventory under the FIFO, LIFO and average cost methods? Present your answers in the following form (in an excel spreadsheet):

                                                                                                                                    Cost

Inventory Method                             Merchandise Inventory                    Merchandise Sold

a. FIFO                                                   $                                                          $

b. LIFO          

c. Weighted average cost

Please can this be answered NEATLY and easy to understand in an excel spreadsheet.

Thank You!

Answer 1

		FIFO	LIFO	Weighted Average Cost
	The ending inventory	$640	$500	$560
	The cost of goods sold	$3,414	$3,554	$3,494
	FIFO
	Units	Unit Cost
	500	$0.24	$120
	2,000	$0.26	$520
	Ending Inventory		$640
	COGS = Beginning inventory + purchases - ending inventory
	=	$1,200 + $2,854 - 640
	=	$3,414
	LIFO
	Units	Unit Cost
	2,500	$0.20	$500
	Ending Inventory		$500
	COGS = Beginning inventory + purchases - ending inventory
	=	$1,200 + $2,854 - 640
	=	$3,554
	Weighted Average Cost
	Units	Unit Cost
	6,000	$0.20	$1,200.00
	4,500	$0.22	$990.00
	5,600	$0.24	$1,344.00
	2,000	$0.26	$520.00
	18,100		$4,054.00
	The average cost per unit		$0.224
	Ending Inventory = 2,500 x $0.224	$560
	COGS = Beginning inventory + purchases - ending inventory
	=	$1,200 + $2,854 - 560
	=	$3,494