A company is closing out the accounting period. The inventory balance at the beg

Question

A company is closing out the accounting period. The inventory balance at the beginning of the period was $222,750, and at the end of the period it was $215,600. Purchases of goods for resale during the period equaled $682,500. What was the cost of goods sold total?

$675,350

$905,250

$682,500

$689,650

The following transactions during the month of January: 1/5 bought 10 units at $11.00 each; 1/8 bought 15 units at $11.25 each; 1/15 sold 8 units for $16 each; 1/22 bought 10 units at $11.50 each and sold 12 units for $16.50 each. The ending inventory is $693.75. What inventory costing method is the company using?

LIFO – perpetual

weighted average

LIFO – periodic

FIFO

$675,350

$905,250

$682,500

$689,650

Explanation / Answer

A) COST OF GOODS SOLD = OPENING STOCK + PURCHASES - CLOSING STOCK

COST OF GOODS SOLD = $222,750 + $682,500 - $215,600

COST OF GOODS SOLD = $689650

B) WEIGHTED AVERAGE INVENTORY COSTING METHOD IS USED BY THE COMPANY.

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