Required information Problem 8-5 (Algo) Various inventory costing methods [LO8-1, 8-4] [The following information applies to the questions displayed below.] A company began January with 8,000 units of its principal product. The cost of each unit is $8. Inventory transactions for the month of January are as follows: Date of Purchase January 10 January 18 Totals Date of Sale January 5 January 12 January 20 Total * Includes purchase price and cost of freight. Sales Perpetual FIFO: Units 6,000 8,000 14,000 Problem 8-5 (Algo) Part 3 Beginning Inventory Purchases: January 10. January 18 Units Total 4,000 2,000 5,000 11,000 11,000 units were on hand at the end of the month. 3. Calculate January's ending inventory and cost of goods sold for the month using FIFO, perpetual system. Number of units Purchases Unit Cost* Cost of Goods Available for Sale $9 10 Unit Cost 6,000 8,000 22,000 8,000 $8.00 $ 9.00 10.00 Total Cost $ 54,000 80,000 $ 134,000 Cost of Number Goods of units Available for sold Sale 64,000 54,000 80,000 $ 198,000 Cost of Goods Sold - January 5 0 Cost per unit $ Cost of Goods Sold 8.00 $ 9.00 10.00 $ 0 0 0 0 Cost of Goods Sold - Jarruary 12 Number of units sold 0 Cost per unit $ 8.00 9.00 10.00 Cost of Goods Sold $ $ 0 0 0 0 Cost of Goods Sold January 20 Number of units sold 0 Cost per unit $ 8.00 9.00 10.00 Cost of Goods Sold $ $ 0 Inventory Balance Number of units in ending inventory of 0 0 0 0 Cost per unit $ Ending Inventory 8.00 $ 9.00 10.00 $ 0 0 0 0
Required information Problem 8-5 (Algo) Various inventory costing methods [LO8-1, 8-4] [The following information applies to the questions displayed below.] A company began January with 8,000 units of its principal product. The cost of each unit is $8. Inventory transactions for the month of January are as follows: Date of Purchase January 10 January 18 Totals Date of Sale January 5 January 12 January 20 Total * Includes purchase price and cost of freight. Sales Perpetual FIFO: Units 6,000 8,000 14,000 Problem 8-5 (Algo) Part 3 Beginning Inventory Purchases: January 10. January 18 Units Total 4,000 2,000 5,000 11,000 11,000 units were on hand at the end of the month. 3. Calculate January's ending inventory and cost of goods sold for the month using FIFO, perpetual system. Number of units Purchases Unit Cost* Cost of Goods Available for Sale $9 10 Unit Cost 6,000 8,000 22,000 8,000 $8.00 $ 9.00 10.00 Total Cost $ 54,000 80,000 $ 134,000 Cost of Number Goods of units Available for sold Sale 64,000 54,000 80,000 $ 198,000 Cost of Goods Sold - January 5 0 Cost per unit $ Cost of Goods Sold 8.00 $ 9.00 10.00 $ 0 0 0 0 Cost of Goods Sold - Jarruary 12 Number of units sold 0 Cost per unit $ 8.00 9.00 10.00 Cost of Goods Sold $ $ 0 0 0 0 Cost of Goods Sold January 20 Number of units sold 0 Cost per unit $ 8.00 9.00 10.00 Cost of Goods Sold $ $ 0 Inventory Balance Number of units in ending inventory of 0 0 0 0 Cost per unit $ Ending Inventory 8.00 $ 9.00 10.00 $ 0 0 0 0
Chapter1: Financial Statements And Business Decisions
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![Required information
Problem 8-5 (Algo) Various inventory costing methods [LO8-1, 8-4]
[The following information applies to the questions displayed below.]
A company began January with 8,000 units of its principal product. The cost of each unit is $8. Inventory transactions for
the month of January are as follows:
Date of Purchase
January 10
January 18
Totals
Date of Sale
January 5
January 12
January 20
Total
* Includes purchase price and cost of freight.
Sales
Perpetual FIFO:
Units
6,000
8,000
14,000
Problem 8-5 (Algo) Part 3
Beginning Inventory
Purchases:
January 10.
January 18
Units
Total
4,000
2,000
5,000
11,000
11,000 units were on hand at the end of the month.
3. Calculate January's ending inventory and cost of goods sold for the month using FIFO, perpetual system.
Number
of units
Purchases
Unit Cost*
Cost of Goods Available for Sale
Cost of
Goods
Available for
Sale
64,000
Unit
Cost
6,000
8,000
22,000
$9
10
8,000 $8.00 $
9.00
10.00
$
Total Cost
$ 54,000
80,000
$ 134,000
54,000
80,000
198,000
Cost of Goods Sold - January 5
Number
of units
sold
0
Cost per
unit
$
Cost of
Goods Sold
8.00 $
9.00
10.00
$
0
0
0
0
Cost of Goods Sold-Jarruary 12
Number
of units
sold
0
Cost per
unit
$
8.00
9.00
10.00
Cost of
Goods Sold
$
$
0
0
0
0
Cost of Goods Sold January 20
Number
of units
sold
0
Cost per
unit
$
8.00
9.00
10.00
Cost of
Goods Sold
$
$
0
Inventory Balance
Number of
units in
ending
inventory
of
0
0
0
0
Cost per
unit
$
Ending
Inventory
8.00 $
9.00
10,00
$
0
0
0
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F3f776868-c27f-4d6e-82b8-cc408728fc94%2F12cd1b80-de0c-49d5-a0a3-1fa9deda85d8%2Ft3e1pmv_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Required information
Problem 8-5 (Algo) Various inventory costing methods [LO8-1, 8-4]
[The following information applies to the questions displayed below.]
A company began January with 8,000 units of its principal product. The cost of each unit is $8. Inventory transactions for
the month of January are as follows:
Date of Purchase
January 10
January 18
Totals
Date of Sale
January 5
January 12
January 20
Total
* Includes purchase price and cost of freight.
Sales
Perpetual FIFO:
Units
6,000
8,000
14,000
Problem 8-5 (Algo) Part 3
Beginning Inventory
Purchases:
January 10.
January 18
Units
Total
4,000
2,000
5,000
11,000
11,000 units were on hand at the end of the month.
3. Calculate January's ending inventory and cost of goods sold for the month using FIFO, perpetual system.
Number
of units
Purchases
Unit Cost*
Cost of Goods Available for Sale
Cost of
Goods
Available for
Sale
64,000
Unit
Cost
6,000
8,000
22,000
$9
10
8,000 $8.00 $
9.00
10.00
$
Total Cost
$ 54,000
80,000
$ 134,000
54,000
80,000
198,000
Cost of Goods Sold - January 5
Number
of units
sold
0
Cost per
unit
$
Cost of
Goods Sold
8.00 $
9.00
10.00
$
0
0
0
0
Cost of Goods Sold-Jarruary 12
Number
of units
sold
0
Cost per
unit
$
8.00
9.00
10.00
Cost of
Goods Sold
$
$
0
0
0
0
Cost of Goods Sold January 20
Number
of units
sold
0
Cost per
unit
$
8.00
9.00
10.00
Cost of
Goods Sold
$
$
0
Inventory Balance
Number of
units in
ending
inventory
of
0
0
0
0
Cost per
unit
$
Ending
Inventory
8.00 $
9.00
10,00
$
0
0
0
0
Expert Solution
Step 1
FIFO Method :— It is one of the method of inventory valuation in which it is assumed that beginning inventory is used for output then remaining sale units from first purchases then after second purchases than after third purchases and soon.
January 05 sale is used from the beginning inventory of 4,000 out of 8,000.
4,000 units of beginning Inventory is balance.
2,000 units of beginning inventory is used in sale on January 12.
2,000 units of beginning inventory is used in sale on January 20.
Remaining sale units of January 20 sale is 3,000 which is used from first purchases on January 10.
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