Blue Corp. had 1,800 units of part T on hand April 1, 2017, costing $8.00 each....

Blue Corp. had 1,800 units of part T on hand April 1, 2017, costing $8.00 each. During April, Blue made the following purchases of part T.

		Units	Unit Cost
April	4	2,800	$8.25
	10	4,800	8.40
	19	1,200	9.00
	29	2,500	9.90

A physical count at April 30, 2017 showed 4,000 units of Part T on hand.

Using the FIFO method, what is the cost of part T inventory at April 30, 2017? Using the LIFO method, what is the inventory cost? Using the average-cost method, what is the inventory cost?

Expert Solution

Answer-----------

	FIFO	LIFO	Weighted Average
Ending Inventory	$ 38,070	$ 32,550	$ 34,617

Working

	Units	Cost per unit	value
Beginning Balance	1800	$ 8.00	$ 14,400
Purchases
	2800	$ 8.25	$ 23,100
	4800	$ 8.40	$ 40,320
	1200	$ 9.00	$ 10,800
	2500	$ 9.90	$ 24,750

Cost of goods available for sale	13100		$ 113,370

.

Average Cost of Inventory

Units	(A)	13100
Total Cost	(B)	$ 113,370
Average Cost	(C=B/A)	$ 8.65

.

FIFO
Total Units Available for sale		13100
Units Sold		9100
Closing Stock in Units		4000

Valuation
Ending Inventory	2500	@	$ 9.90	$ 24,750
	1200	@	$ 9.00	$ 10,800
	300	@	$ 8.40	$ 2,520
Value Of Ending Inventory				$ 38,070

.

LIFO
Total Units Available for sale		13100
Units Sold		9100
Closing Stock in Units		4000

Valuation
Ending Inventory	1800	@	$ 8.00	$ 14,400
	2200	@	$ 8.25	$ 18,150

Value Of Ending Inventory				$ 32,550

.

Weighted Average method
Total Units Available for sale		13100
Units Sold		9100
Closing Stock in Units		4000

Valuation
Ending Inventory	4000	@	$ 8.6542	$ 34,617

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