Oahu Kiki tracks the number of units purchased and sold throughout each accounti

Question

Oahu Kiki tracks the number of units purchased and sold throughout each accounting period but applies its inventory costing method at the end of each month, as if it uses a periodic inventory system. Assume Oahu Kiki's records show the following for the month of January. Sales totaled 290 units. Units Unit Cost Total Cost Beginning Inventory Purchase Purchase January 1 240 January 15 450 January 24 210 70 80 100 $16,800 36,000 21,000 Required 1. Calculate the number and cost of goods available for sale Number of Goods Available for Sale units Cost of Goods Available for Sale 2. Calculate the number of units in ending inventory Ending Inventory units 3. Calculate the cost of ending inventory and cost of goods sold using the (a) FIFO, (b) LIFO, and (c) weighted average cost methods Cost of Ending Inventory Cost of Goods Sold FIFO LIFO Weighted Average Cost

Explanation / Answer

1) Number of units available for sale = 240+450+210 = 900 units

Cost of goods available for sale = 16800+36000+21000 = $73800

2) Ending inventory unit = 900-290 = 610 units

3) Calculate ending inventory and cost of goods sold :

Cost of ending inventory Cost of goods sold FIFO (210*100+400*80) = 53000 73800-53000 = 20800 LIFO (240*70+370*80) = 46400 73800-46400 = 27400 Weighted average cost (73800/900)*610 = 50020 73800-50020 = 23780

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