Please asssit with this Homework problem. Jones Company records the following ac
ID: 2504654 • Letter: P
Question
Please asssit with this Homework problem.
Jones Company records the following activity as it relates to their inventory activity for the month of January.
1/1 Beginning Inv 600 units @ $35/unit
1/10 Purchase 450 units @ $56/unit
1/13 Purchase 200 units @ $57/unit
1/15 Sales 430 @90/unit
1/21 Purchase 230 units @ $58/unit
1/30 Purchase 345 units @ $59/unit
1/31 Sales 335 @90/unit
Compute ending inventory using the FIFO method.
Compute cost of good sold using FIFO.
Compute ending inventory using LIFO
Compute cost of goods sold using the LIFO method.
Explanation / Answer
Hi,
Please find the detailed answer as follows:
Total Units Available for Sale = 600 + 450 + 200 + 230 + 345 = 1825 units
Total Units Sold = 430 + 335 = 765
Ending Inventory = Total Units Available for Sale - Units Sold = 1825 - 430 - 335 = 1060 units
FIFO:
Ending Inventory Value = 345*59 + 230*58 + 200*57 + (1060 - 345 - 230 - 200)*56 = 61055
Cost of Goods Sold Value = 600*35 + (765 - 600)*56 = 30240
LIFO:
Ending Inventory Value = 600*35 + 450*56 + (1060-600-450)*57 = 46770
Cost of Goods Sold Value = 345*59 + 230*58 + (765 - 345 - 230)*57 = 44525
Thanks.