Question

A company reports the following beginning inventory and two purchases for the month of January. On January 26, the company sells 410 units. Ending inventory at January 31 totals 150 units. Units Unit Cost Beginning inventory on January 1 370 $ 3.60 Purchase on January 9 80 3.80 Purchase on January 25 110 3.90 Required: Assume the perpetual invent

Answer 1

Answer:

Cost of ending inventory using:

LIFO = $540

FIFO = $581

weighted average = $553.13

Explanation:

                                                                     Units           Unit Cost

Beginning inventory on January 1                370               $3.60

Purchase on January 9                                   80               $3.80

Purchase on January 25                                110               $3.90

Sales on January 26, the company sells 410 units.

Ending inventory 150 units

Cost of ending inventory using:

LIFO = 150 x $3.60 = $540

FIFO = (110 x $3.90) + (40 x $3.80) = $581

weighted average = ($2,065 / 560) x 150 units = $553.13