Question: Causwell Company began 2016 with 30,000 units of inventory on hand. The cost of each unit was $5.00. During 2016, an additional 50,000 units were purchased at a single unit cost, and 40,000 units remained on hand at the end of 2016 (40,000 units therefore were sold during 2016). Causwell uses a periodic inventory system. Cost of goods sold for 2016, applying the average cost method, is $224,000. The company is interested in determining what cost of goods sold would have been, if the FIFO or LIFO methods were used. 1. Determine the cost of goods sold for 2016 using the FIFO method. (Hint: Determine the cost per unit of 2016 purchases.) 2. Determine the cost of goods sold for 2016 using the LIFO method. (Do not round intermediate calculations.)

Question: Causwell Company began 2016 with 30,000 units of inventory on hand. The cost of each unit was $5.00. During 2016, an additional 50,000 units were purchased at a single unit cost, and 40,000 units remained on hand at the end of 2016 (40,000 units therefore were sold during 2016). Causwell uses a periodic inventory system. Cost of goods sold for 2016, applying the average cost method, is $224,000. The company is interested in determining what cost of goods sold would have been, if the FIFO or LIFO methods were used. 1. Determine the cost of goods sold for 2016 using the FIFO method. (Hint: Determine the cost per unit of 2016 purchases.) 2. Determine the cost of goods sold for 2016 using the LIFO method. (Do not round intermediate calculations.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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