Use the following information for questions 12, 13, and 14. Pederson Company was

Question

Use the following information for questions 12, 13, and 14. Pederson Company was formed on December 1, 2015. The following information is available from Pederson's inventory records for the product X:

11. Assuming that Pederson uses a perpetual inventory system, what is ENDING INVENTORY at December 31, 2015 under the FIFO method? a. $18,100 b. $27,100 c. $16,800 d. $13,800 e. None of the above

12. Assuming that Pederson uses a perpetual inventory system, what is ENDING INVENTORY at December 31, 2015 under the LIFO method? a. $18,300 b. $17,600 c. $26,300 d. $25,600 e. None of the above

13. Assuming that Pederson uses a periodic inventory system, what is ENDING INVENTORY at December 31, 2015 under the weighted average method? a. $17,200 b. $26,700 c. $17,560 d. $26,340 e. None of the above

I have the answers, just don't understand the concepts so work is appreciated!

Thanks!

Date Purchases Sold/Issued Balance 12/2 2000 units @ $4.00/unit 2,000 12/15 6000 units @4.40/unit 8000 12/19 4000 units 4000 12/30 2000 units @ 4.75/unit 6000

Explanation / Answer

Q11 b. $27,100 FIFO Date Particulars Units   Cost Amount COGS 2-Dec Purchase                                 2,000.00                           4.00                            8,000.00 15-Dec Purchase                                 6,000.00                           4.40                          26,400.00 Total                                 8,000.00                          34,400.00 19-Dec COGS                                 4,000.00                          16,800.00 2000*4+2000*4.40 Balance                                 4,000.00                          17,600.00 30-Dec Purchase                                 2,000.00                           4.75                            9,500.00 Closing Stock                                 6,000.00                          27,100.00 Q12 =c. $26,300 LIFO Date Particulars Units   Cost Amount COGS 2-Dec Purchase                                 2,000.00                           4.00                            8,000.00 15-Dec Purchase                                 6,000.00                           4.40                          26,400.00 Total                                 8,000.00                          34,400.00 19-Dec COGS                                 4,000.00                          17,600.00 4000*4.40 Balance                                 4,000.00                          16,800.00 30-Dec Purchase                                 2,000.00                           4.75                            9,500.00 Closing Stock                                 6,000.00                          26,300.00 Q13   d. $26,340 Weighted Average Method Date Particulars Units   Cost Amount COGS 2-Dec Purchase                                 2,000.00                           4.00                            8,000.00 15-Dec Purchase                                 6,000.00                           4.40                          26,400.00 30-Dec Purchase                                 2,000.00                           4.75                            9,500.00 Total                              10,000.00                           4.39                          43,900.00 29-Oct COGS                                 4,000.00                           4.39                          17,560.00 Closing Stock                                 6,000.00                           4.39                          26,340.00

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