Answer and Explanation:
Ferris Company
1. Average cost periodic
Dollars $48,000+$ 105,000
= $153,000
Units $11,000+$6,000
= $17,000
153,000 / 17,000 = $9.00 Cost per unit
Cost of Goods Sold:
9,000 units × $9.00= $81,000
Ending Inventory:
8,000 units × $9.00= $72,000
2. Average cost perpetual Jan 5th sales
Dollars 48,000
Units 6000
48,000 / 6,000 = $8.00 Cost per unit
Cost of goods Sold:
3,000 units × $8.00= $24,000
Ending Inventory:
3,000 units × $8.00= $24,000
3. Average cost perpetual Jan 12th sales
Dollars 69,000
Units 8000
69,000 / 8,000 = $8.625 Cost per unit
Cost of Goods Sold:
2,000 units × $8.625
= $17,250
Ending Inventory:
6,000 units × $8.625
= $51,750
4. Average cost perpetual Jan 20th sales
Dollars 60,000+51,750
=111,750
Units 6000+6000
=12,000
111,750 / 12,000 = $9.3125 Cost per unit
Cost of Goods Sold:4,000 units ×$9.3125= $37,250
Ending Inventory:8,000 units × $9.3125= $74,500
Summary of Average Cost Perpetual
Cost of Goods Sold:
Jan 5 3,000 units= $24,000
Jan 12 2,000 units= 17,250
Jan 20 4,000units = 37,250
Total 9,000units = $78,500
Summary of Results
Cost ofGoods Sold EndingInventory
FIFO, Periodic $ 75,000 $78,000
LIFO, Periodic$87,000 $66,000
LIFO, Perpetual $82,000 $71,000
Average Cost, Periodic $81,000 $72,000
Average Cost, Perpetual $78,500 $74,500
