Alfa INC began January 2021 with 20 units of iron inventory that cost 15 euro each. During January, the company completed the following inventory transactions: Date Activity Units Units Cost January 3 Sale 15 January 8 Purchase 75 25 euro January 21 Sale 40 January 30 Purchase 50 30 euro Prepare a perpetual inventory record for the merchandise inventory using the: 1. FIFO 2. LIFO 3. Weighted average method determine the cost of the good sold, comparing the three methods above. determine the residual value of the inventory.

Alfa INC began January 2021 with 20 units of iron inventory that cost 15 euro each. During January, the company completed the following inventory transactions: Date Activity Units Units Cost January 3 Sale 15 January 8 Purchase 75 25 euro January 21 Sale 40 January 30 Purchase 50 30 euro Prepare a perpetual inventory record for the merchandise inventory using the: 1. FIFO 2. LIFO 3. Weighted average method determine the cost of the good sold, comparing the three methods above. determine the residual value of the inventory.

Name: Alfa INC began January 2021 with 20 units of iron inventory thatcost
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Description: Alfa INC began January 2021 with 20 units of iron inventory thatcost 15 euro each. During January, the company completed thefollowing inventory transactions:DateActivityUnitsUnits CostJanuary 3Sale15January 8Purchase7525 euroJanuary 21Sale40January

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Concept explainers

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

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Question

Alfa INC began January 2021 with 20 units of iron inventory that
cost 15 euro each. During January, the company completed the
following inventory transactions:
Date
Activity
Units
Units Cost
January 3
Sale
15
January 8
Purchase
75
25 euro
January 21
Sale
40
January 30
Purchase
50
30 euro
Prepare a perpetual inventory record for the merchandise inventory
using the:
1.
FIFO
2.
LIFO
Weighted average method
determine the cost of the good sold, comparing the three
methods above.
determine the residual value of the inventory.
3.

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