A company began January with 6,000 units of its principal product. The cost of each unit is $8. Inventory transactions for the month of January are as follows: Purchases Date of Purchase Units Unit Cost* Total Cost Jan. 10 5,000 $9 $45,000 Jan. 18 6,000 10 60,000 Total purchases 11,000 $105,000 *Includes purchase price and cost of freight. Sales Date of Sale Units Jan. 5 3,000 Jan. 12 2,000 Jan. 20 4,000 Total sales 9,000 8,000 units were on hand at the end of the month. Required: Calculate January’s ending inventory and cost of goods sold for the month using each of the following alternatives: FIFO, periodic system LIFO, periodic system FIFO, perpetual system
8–5
Various inventory costing methods
● LO8–1, LO8–4
A company began January with 6,000 units of its principal product. The cost of each unit is $8. Inventory transactions for the month of January are as follows:
Purchases
Date of Purchase
Units
Unit Cost*
Total Cost
Jan. 10
5,000
$9
$45,000
Jan. 18
6,000
10
60,000
Total purchases
11,000
$105,000
*Includes purchase price and cost of freight.
Sales
Date of Sale
Units
Jan. 5
3,000
Jan. 12
2,000
Jan. 20
4,000
Total sales
9,000
8,000 units were on hand at the end of the month.
Required:
Calculate January’s ending inventory and cost of goods sold for the month using each of the following alternatives:
FIFO, periodic system
LIFO, periodic system
FIFO, perpetual system
Average cost, periodic system
Average cost, perpetual system
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