Question

Jimmie’s Fishing Hole has the following transactions related to its top-selling Shimano fishing reel for the month of June. Jimmie’s Fishing Hole uses a periodic inventory system.

Date	Transactions	Units	Cost per Unit	Total Cost
June 1	Beginning inventory	16	$190	$ 3,040
June 7	Sale	11
June 12	Purchase	10	180	1,800
June 15	Sale	12
June 24	Purchase	10	170	1,700
June 27	Sale	8
June 29	Purchase	9	160	1,440
				$7,980

3.

Required information

Required:
1. Calculate ending inventory and cost of goods sold at June 30, using the specific identification method. The June 7 sale consists of fishing reels from beginning inventory, the June 15 sale consists of three fishing reels from beginning inventory and nine fishing reels from the June 12 purchase, and the June 27 sale consists of one fishing reel from beginning inventory and seven fishing reels from the June 24 purchase.  

4.

Required information

2. Using FIFO, calculate ending inventory and cost of goods sold at June 30.

5.

Required information

3. Using LIFO, calculate ending inventory and cost of goods sold at June 30.

Answer 1

• All working forms part of the answer
• Requirement 1

Specific Identification	Cost of Goods available for sale			Cost of Goods Sold			Ending Inventory
	Units	Cost/unit	COG for sale	Units sold	Cost/unit	COGS	Units	Cost/unit	Ending inventory
Beginning Inventory	16	$              190.00	$                        3,040.00	15	$       190.00	$           2,850.00	1	$      190.00	$                190.00
Purchases:	0	$                       -	$                                     -
12-Jun	10	$              180.00	$                        1,800.00	9	$       180.00	$           1,620.00	1	$      180.00	$                180.00
24-Jun	10	$              170.00	$                        1,700.00	7	$       170.00	$           1,190.00	3	$      170.00	$                510.00
29-Jun	9	$              160.00	$                        1,440.00		$       160.00	$                        -	9	$      160.00	$            1,440.00
TOTAL	45		$                        7,980.00	31		$           5,660.00	14		$            2,320.00

• Requirement 2

FIFO	Cost of Goods available for sale			Cost of Goods Sold			Ending Inventory
	Units	Cost/unit	COG for sale	Units sold	Cost/unit	COGS	Units	Cost/unit	Ending inventory
Beginning Inventory	16	$              190.00	$                        3,040.00	16	$       190.00	$           3,040.00	0	$      190.00	$                         -
Purchases:
12-Jun	10	$              180.00	$                        1,800.00	10	$       180.00	$           1,800.00	0	$      180.00	$                         -
24-Jun	10	$              170.00	$                        1,700.00	5	$       170.00	$              850.00	5	$      170.00	$                850.00
29-Jun	9	$              160.00	$                        1,440.00		$       160.00	$                        -	9	$      160.00	$            1,440.00
TOTAL	45		$                        7,980.00	31		$           5,690.00	14		$            2,290.00

• Requirement 3

LIFO	Cost of Goods available for sale			Cost of Goods Sold			Ending Inventory
	Units	Cost/unit	COG for sale	Units sold	Cost/unit	COGS	Units	Cost/unit	Ending inventory
Beginning Inventory	16	$              190.00	$                        3,040.00	2	$       190.00	$              380.00	14	$      190.00	$            2,660.00
Purchases:	0	$                       -	$                                     -
12-Jun	10	$              180.00	$                        1,800.00	10	$       180.00	$           1,800.00	0	$      180.00	$                         -
24-Jun	10	$              170.00	$                        1,700.00	10	$       170.00	$           1,700.00	0	$      170.00	$                         -
29-Jun	9	$              160.00	$                        1,440.00	9	$       160.00	$           1,440.00	0	$      160.00	$                         -
TOTAL	45		$                        7,980.00	31		$           5,320.00	14		$            2,660.00

• All Requirement answer summarised

Periodic Inventory System
	Specific Identification Method	FIFO Method	LIFO Method
Cost of Ending Inventory	$             2,320	$   2,290	$   2,660
Cost of goods sold	$             5,660	$   5,690	$   5,320