The following data has been provided by Lee Company regarding its inventory purchases and sales throughout the year. TransactionUnitsCost per Unit1-JanBalance175 $86 14-MarSale55 23-MayPurchase135 90 21-AugSale100 5-NovPurchase175 91 18-NovSale100 30-NovSale100 5-DecSale100 10-DecPurchase25 95 Required:Compute the cost of goods sold and ending inventory using the perpetual inventory system for the FIFO cost flow assumption.

Name: The following data has been provided by Lee Company regarding its inve
Uploaded: 2024-03-20T06:32:37.000Z
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Description: The following data has been provided by Lee Company regarding its inventory purchases and sales throughout the year. TransactionUnitsCost per Unit1-JanBalance175 $86 14-MarSale55 23-MayPurchase135 90 21-AugSale100

FIFO: The first-in, first-out (FIFO) method is a widely used inventory valuation method that assumes that the goods are sold or materials are issued to the production department in the order in which they are purchased. In other words, the costs to acquire merchandise or materials are charged against revenues in the order in which they are incurred. Under the first-in, first-out method, the ending balance of inventory represents the most recent costs incurred to purchase merchandise or materials. Purchases Cost of goods sold Ending balance # of units per unit Cost # of units per unit Cost # of units per unit Cost Balance 175 $86 $15,050 March 14 55 $86 $4,730 120 $86 $10,320 May 23 135 $90 $12,150 120 $86 $10,320 135 $90 $12,150 August 21 100 $86 $8,600 20 $86 $1,720 135 $90 $12,150 Nov. 5 175 $91 $15,925 20 $86 $1,720 135 $90 $12,150 175 $91 $15,925 Nov. 18 20 $86 $1,720 55 $90 $4,950 80 $90 $7,200 175 $91 $15,925 Nov. 30 55 $90 $4,950 130 $91 $11,830 45 $91 $4,095 Dec. 5 100 $91 $9,100 30 $91 $2,730 Dec. 10 25 $95 $2375 30 $91 $2,730 25 $95 $2375 Total $40,395 $5,105Cost of goods sold using FIFO = $40,395 Ending inventory using FIFO = $5,105

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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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The following data has been provided by Lee Company regarding its inventory purchases and sales throughout the year.

	Transaction	Units	Cost per Unit
1-Jan	Balance	175	$86
14-Mar	Sale	55
23-May	Purchase	135	90
21-Aug	Sale	100
5-Nov	Purchase	175	91
18-Nov	Sale	100
30-Nov	Sale	100
5-Dec	Sale	100
10-Dec	Purchase	25	95

Required:
Compute the cost of goods sold and ending inventory using the perpetual inventory system for the FIFO cost flow assumption.

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