Answer:
Concept/Method W-A FIFO LIFO
Ending Inventory $ 14,280 10,240 9,300
COGS $ 21,420 25,460 26,400
Explanation:
First, we calcualte the goods available for sale through the year:
Jan. 1 Inventory 30 units at $110 = 3,300
Mar. 10 Purchase 60 units at $120 = 7,200
Aug. 30 Purchase 10 units at $124 = 12,400
Dec. 12 Purchase<u> 100 units</u> at $128 = <u>12,800</u>
Goods Available: 200 units Cost: 35,700
<u>Weighted average:</u>
we divide the cost of goods available over the units :
35,700 / 200 = 178.5
Then we multiply for COGS and EI
120 units x $ 178.5 = $ 21,420 COGS
80 units x $ 178.5 = $ 14,280 Ending Inventory
<u>FIFO</u>
The first untis(oldest) are COGS and the last are inventory.
we determinate the ending inventory from the last row:
Dec. 12 Purchase<u> 100 units</u> at $128 = <u>12,800</u>
On ending inventory there is 80 units so:
80 units x 128 = 10,240
Then COGS will be the diffrence between cost of good available and ending inventory:
35,700 - 10,240 = 25,460
<u>LIFO</u>
the last units (newest) are COGS and the first are inventory
we determinate the ending inventory from the first row:
Jan. 1 Inventory <u>30 units </u>at $110 = 3,300
Ending invenotory 80 units - 30 units = 50 more units
we "grab" one more row:
Mar. 10 Purchase 60 units at $120 = 7,200
from we he need 50 units at 120
so ending inventory is:
30 units at $ 110 = 3,300
50 units at $ 120 = 6,000
Total 9,300
Then, COGS is calculated by dfference like FIFO:
35,700 availalbe goods - 9,300 ending inventory = 26,400
