Answer:
Crane Company
1. Weighted average cost per unit = $25.032
2. (1) LIFO (2) FIFO (3) Average-cost
Ending inventory $1,580 $1,940 $1,752
Cost of goods sold 6,180 5,820 6,008
Sales revenue $9,150 $9,150 $9,150
Gross profit 2,970 3,330 3,142
Gross profit rate 32.5% 36.4% 34.3%
Explanation:
a) Data and Calculations:
Date Description Units Unit Cost or Selling Price Total
Oct. 1 Beginning inventory 50 $22 $1,100
Oct. 9 Purchase 110 24 2,640
Oct. 11 Sale (90) $35 $3,150
Oct. 17 Purchase 90 26 2,340
Oct. 22 Sale (50) 40 2,000
Oct. 25 Purchase 60 28 1,680
Oct. 29 Sale (100) 40 4,000
Total 310 (240) = 70 $7,760 $9,150
Weighted average cost per unit = $25.032
LIFO:
Ending inventory
= (50 * $22) + (20 * $24)
= $1,100 + $480
= $1,580
Cost of goods sold = $7,760 - $1,580 = $6,180
FIFO:l
Ending inventory:
= (60 * $28) + (10 * $26)
= $1,680 + $260 = $1,940
Cost of goods sold = $7,760 - $1,940 = $5,820
Weighted-average costs:
Ending inventory = 70 * $25.032 = $1,752
Cost of goods sold = $7,760 = $1,752 = $6,008
