Aircard Corporation tracks the number of units purchased and sold throughout eac

Question

Aircard Corporation tracks the number of units purchased and sold throughout each accounting period but applies its inventory costing method at the end of each period as if it uses a periodic inventory system. The following are the transactions for the month of July Units Unit Cost July 1 Begining Inventory2000 $40 July 5 Sold July 13 Purchased July 17 Sold July 25 Purchased July 27 Sold 1,000 6,000 42 3,000 8,000 44 5,000 Calculate the cost of goods available for sale, ending inventory, and cost of goods sold if Aircard uses (a) FIFO, (b) LIFO, or (c) weighted average cost. (Round "Cost per Unit to 2 decimal places.) Weighted verage Cost FIFO LIFO Cost of Goods Available for Sale Ending Inventory Cost of Goods Sold

Explanation / Answer

Solution:

Computation of COGS and ending inventory - Periodic FIFO Particulars Cost of goods available for sale Cost of goods sold Ending Inventory Nos of units Unit Cost Cost of goods available for sale Nos of units sold Unit Cost Cost of goods sold Nos of units in ending inventory Unit Cost Ending inventory Beginning inventory 2000 $40.00 $80,000 2000 $40.00 $80,000.00 0 $40.00 $0.00 Purchases: 13-Jul 6000 $42.00 $252,000 6000 $42.00 $252,000.00 0 $42.00 $0.00 25-Jul 8000 $44.00 $352,000 1000 $44.00 $44,000.00 7000 $44.00 $308,000.00 Total 16000 $684,000 9000 $376,000.00 7000 $308,000.00

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