Chapter 8, Problem 8.7P

Various inventory costing methods

• LO8–1, LO8–4

Carlson Auto Dealers Inc. sells a handmade automobile as its only product. Each automobile is identical; however, they can be distinguished by their unique ID number. At the beginning of 2018, Carlson had three cars in inventory, as follows:

Car ID	Cost
203	$60,000
207	60,000
210	63,000

During 2018, each of the three autos sold for $90,000. Additional purchases (listed in chronological order) and sales for the year were as follows:

Car ID	Cost	Selling Price
211	$63,000	$ 90,000
212	63,000	93,000
213	64,500	not sold
214	66,000	96,000
215	69,000	100,500
216	70,500	not sold
217	72,000	105,000
218	72,300	106,500
219	75,000	not sold

Required:

1. Calculate 2018 ending inventory and cost of goods sold assuming the company uses the specific identification inventory method.

2. Calculate ending inventory and cost of goods sold assuming FIFO and a periodic inventory system.

3. Calculate ending inventory and cost of goods sold assuming LIFO and a periodic inventory system.

4. Calculate ending inventory and cost of goods sold assuming the average cost method and a periodic inventory system.