Beginning inventory, purchases and sales data for T-shirts are as follows: April 3 Inventory 24 units @ $10 11 Purchase 26 units @ $12 14 Sale 36 units 21 Purchase 18 units @ $15 25 Sale 20 units Assuming the business maintains a periodic inventory system; calculate the cost of merchandise sold and ending inventory under the following assumptions: FIFO LIFO Average cost In your computations, round the average cost per unit to two decimal places and round your final answers to the nearest dollar.
Beginning inventory, purchases and sales data for T-shirts are as follows:
| April 3 | Inventory | 24 units | @ | $10 |
| 11 | Purchase | 26 units | @ | $12 |
| 14 | Sale | 36 units | ||
| 21 | Purchase | 18 units | @ | $15 |
| 25 | Sale | 20 units |
Assuming the business maintains a periodic inventory system; calculate the cost of merchandise sold and ending inventory under the following assumptions:
- FIFO
- LIFO
- Average cost
In your computations, round the average cost per unit to two decimal places and round your final answers to the nearest dollar.
Inventory is a physical item of trade sold by suppliers during their accounting period. There are two methods of inventory control:
There are two methods to control the inventory:
- Perpetual inventory system
- Periodic inventory system
Periodic inventory system:
Under this method, all inventory transitions are done at the end of the year. It is a time-consuming process.
There are three methods of inventory valuation:
- First in first out
- Last in first out
- Average cost
Under the FIFO method, older units are sold first and recorded according to the date of arrival or manufactured. It is used to avoid obsolescence.
Under the LIFO method new inventory issues first and the older inventory remains in the finished goods inventory.
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