Ask Question
14 December, 17:30

Inventory by Three Methods The units of an item available for sale during the year were as follows: Jan. 1 Inventory 27 units at $400 Feb. 19 Purchase 54 units at $460 June 8 Purchase 63 units at $520 Oct. 7 Purchase 56 units at $550 There are 45 units of the item in the physical inventory at December 31. Determine the cost of ending inventory using (a) the first-in, first-out method, (b) the last-in, first-out method, and (c) the average cost method. Inventory Cost a. First-in, first-out method $ 24,750 b. Last-in, first-out method $ 19,080 c. Average cost method $ 111,150

+5
Answers (1)
  1. 14 December, 19:33
    0
    FIFO Ending Inventory $ 24750

    LIFO Ending Inventory $ 19080

    Average Cost Method Ending Inventory $22,320

    Explanation:

    Date Units Unit Price Total Cost

    Jan. 1 Inventory 27 units $400 $ 10800

    Feb. 19 Purchase 54 units $460 $ 24840

    June 8 Purchase 63 units $520 $ 32760

    Oct. 7 Purchase 56 units $550 $ 30800

    Total 200 units $ 99200

    There are 45 units of the item in the physical inventory at December 31

    FIFO Ending Inventory

    45 units at $ 550 = $ 24750

    LIFO Ending Inventory $ 19080

    27 units at $ 400 = $ 10800

    18 units at $ 460 = $ 8280

    Average Cost Method Ending Inventory $ 22,320

    Units Cost = $ 99200 / 200 = $ 496

    45 units at $ 496 = 22,320
Know the Answer?
Not Sure About the Answer?
Find an answer to your question ✅ “Inventory by Three Methods The units of an item available for sale during the year were as follows: Jan. 1 Inventory 27 units at $400 Feb. ...” in 📘 Business if you're in doubt about the correctness of the answers or there's no answer, then try to use the smart search and find answers to the similar questions.
Search for Other Answers