Answer:
Causwell Company
FIFO LIFO
Cost of goods sold $181,400 $203,000
Explanation:
Data and Calculations: Units Unit Cost Weighted FIFO LIFO
Beginning Inventory = 27,000 $5 $135,000 $135,000 $135,000
Purchases of inventory 45,000 $5.8 $261,000 $261,000 $261,000
Goods available 72,000 $396,000 $396,000 $396,000
Ending Inventory (37,000) $5.5 $203,500 $214,600 $193,000
Inventory Sold 35,000 $5.5 $192,500 $181,400 $203,000
Unit cost = $5.00
Computation of the Value of beginning inventory = $135,000 (27,000 x $5)
From the value of Inventory Sold (Cost of goods sold), determine the unit cost. This is applied to the ending inventory units, to ascertain its value. This value is added to the cost of goods sold, to determine the cost of goods available for sale, which is made up of the beginning inventory and purchases. From the Cost of Goods Available for Sale subtract the beginning inventory, to obtain the purchases in amount. Divide the value by units and you obtain the unit cost.
