Details regarding the inventory of appliances on January 1, 20Y7, purchases invoices during the year, and the inventory count on December 31, 20Y7, of Amsterdam Appliances are summarized as follows: Purchases Invoices Model Inventory, January 1 1st 2nd
Details regarding the inventory of appliances on January 1, 20Y7, purchases invoices during the year, and the inventory count on December 31, 20Y7, of Amsterdam Appliances are summarized as follows:
| Purchases Invoices | ||||||||||||||
| Model | Inventory, January 1 |
1st | 2nd | 3rd | Inventory Count, December 31 |
|||||||||
| A10 | — | 4 at $ 64 | 4 at $ 70 | 4 at $ 76 | 6 | |||||||||
| B15 | 8 at $176 | 4 at 158 | 3 at 170 | 6 at 184 | 8 | |||||||||
| E60 | 3 at 75 | 3 at 65 | 15 at 68 | 9 at 70 | 5 | |||||||||
| G83 | 7 at 242 | 6 at 250 | 5 at 260 | 10 at 259 | 9 | |||||||||
| J34 | 12 at 240 | 10 at 246 | 16 at 267 | 16 at 270 | 15 | |||||||||
| M90 | 2 at 108 | 2 at 110 | 3 at 128 | 3 at 130 | 5 | |||||||||
| Q70 | 5 at 160 | 4 at 170 | 4 at 175 | 7 at 180 | 8 |
Instructions:
1. Determine the cost of the inventory on December 31, 20Y7, by the first-in, first-out method.
If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. Under FIFO, if a model is in inventory at two different costs, enter the remaining units that were purchased most recently first.
| First-In, First-Out Method | ||||
| Model | Quantity | Unit Cost | Total Cost | |
| A10 | fill in the blank 1 | $fill in the blank 2 | $fill in the blank 3 | |
| fill in the blank 4 | fill in the blank 5 | fill in the blank 6 | ||
| B15 | fill in the blank 7 | fill in the blank 8 | fill in the blank 9 | |
| fill in the blank 10 | fill in the blank 11 | fill in the blank 12 | ||
| E60 | fill in the blank 13 | fill in the blank 14 | fill in the blank 15 | |
| G83 | fill in the blank 16 | fill in the blank 17 | fill in the blank 18 | |
| J34 | fill in the blank 19 | fill in the blank 20 | fill in the blank 21 | |
| M90 | fill in the blank 22 | fill in the blank 23 | fill in the blank 24 | |
| fill in the blank 25 | fill in the blank 26 | fill in the blank 27 | ||
| Q70 | fill in the blank 28 | fill in the blank 29 | fill in the blank 30 | |
| fill in the blank 31 | fill in the blank 32 | fill in the blank 33 | ||
| Total | $fill in the blank 34 |
2. Determine the cost of the inventory on December 31, 20Y7, by the last-in, first-out method, following the procedures indicated in (1). Under LIFO, if a model is in inventory at two different costs, enter the remaining units that were purchased earliest first.
| Last-In, First-Out Method | ||||
| Model | Quantity | Unit Cost | Total Cost | |
| A10 | fill in the blank 35 | $fill in the blank 36 | $fill in the blank 37 | |
| fill in the blank 38 | fill in the blank 39 | fill in the blank 40 | ||
| B15 | fill in the blank 41 | fill in the blank 42 | fill in the blank 43 | |
| E60 | fill in the blank 44 | fill in the blank 45 | fill in the blank 46 | |
| fill in the blank 47 | fill in the blank 48 | fill in the blank 49 | ||
| G83 | fill in the blank 50 | fill in the blank 51 | fill in the blank 52 | |
| fill in the blank 53 | fill in the blank 54 | fill in the blank 55 | ||
| J34 | fill in the blank 56 | fill in the blank 57 | fill in the blank 58 | |
| fill in the blank 59 | fill in the blank 60 | fill in the blank 61 | ||
| M90 | fill in the blank 62 | fill in the blank 63 | fill in the blank 64 | |
| fill in the blank 65 | fill in the blank 66 | fill in the blank 67 | ||
| fill in the blank 68 | fill in the blank 69 | fill in the blank 70 | ||
| Q70 | fill in the blank 71 | fill in the blank 72 | fill in the blank 73 | |
| fill in the blank 74 | fill in the blank 75 | fill in the blank 76 | ||
| Total | $fill in the blank 77 |
3. Determine the cost of the inventory on December 31, 20Y7, by the average cost method.
| Average Cost Method | ||||
| Model | Quantity | Unit Cost | Total Cost | |
| A10 | fill in the blank 78 | $fill in the blank 79 | $fill in the blank 80 | |
| B15 | fill in the blank 81 | fill in the blank 82 | fill in the blank 83 | |
| E60 | fill in the blank 84 | fill in the blank 85 | fill in the blank 86 | |
| G83 | fill in the blank 87 | fill in the blank 88 | fill in the blank 89 | |
| J34 | fill in the blank 90 | fill in the blank 91 | fill in the blank 92 | |
| M90 | fill in the blank 93 | fill in the blank 94 | fill in the blank 95 | |
| Q70 | fill in the blank 96 | fill in the blank 97 | fill in the blank 98 | |
| Total | $fill in the blank 99 |
4. Which method (FIFO or LIFO) would be preferred for income tax purposes in periods of rising prices?
Which method (FIFO or LIFO) would be preferred for income tax purposes in periods of declining prices?
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