Problem 6-3A Groves Company Inc. had a beginning Inventory of 139 units of Produ
ID: 2426548 • Letter: P
Question
Problem 6-3A
Groves Company Inc. had a beginning Inventory of 139 units of Product MLN at a cost of $11 per unit. During the year, puchases were:
Feb.20 835 units at $13 Aug. 12 557 units at $15 May 5 696 units at $14 Dec. 8 139 units at $17
Groves Company uses a periodic inventory system. Sales totaled 2,087
Determine the cost of good available for sale
COGS- $32846 Correct
The cost of goods available to sale
Average Cost- $13.883 Correct
Determine the ending inventory and the cost of goods sold unnder each of the assumed cost flow methods ( FIFO, LIFO, and Average Cost
FIFO LIFO Average Cost
The ending Inventory $ $ $
The Costs of goods sold $ $ $
How do you calculate FIFO, LiFO is their a formula?
Explanation / Answer
Beginning Inventory+ Purchases = Cost of Goods Available for Sale
Beginning Inventory = $1529
139 Units @ $11
Purchases
Feb-20 835 Units @ $13 = $10855
Aug-12 557 Units @ $15 = $8355
May 5 696 Units @ $14 = $9744
Dec 8 139 Units @ $17 = $2363
---------
$31317
The Cost of Goods Available to Sales = $32846
Average Cost ($32846/2366) = $13.883
Under FIFO
Units available for Sale = 2366
Units Sold = 2087
Units in Ending Inventory = 279
Cost of Goods Sold
Units
Unit Cost
Total
Sales From Opening inventory
139
$11
$1529
Sales from Feb 20 Purchase
835
$13
$10855
Sales from Aug 12 Purchase
557
$15
$8355
Sales From May 5 Purchase
556
$14
$7784
2087
$28523
Ending Inventory
From May 5 Purchase
140
$14
$1960
From Dec 8 Purchases
139
$17
$2363
279
$4323
Under LIFO
Cost of Goods Sold
Units
Unit Cost
Total
From Dec 8 Purchases
139
$17
$2363
Sales From May 5 Purchase
696
$14
$9744
Sales from Aug 12 Purchase
557
$15
$8355
Sales from Feb 20 Purchase
695
$13
$9035
2087
$29497
Ending Inventory
From Opening inventory
139
$11
$1529
From Feb 20 Purchases
140
$13
$1820
279
$3349
Under Average Cost
Cost of Goods Sold
Units
Unit Cost
Total
Cost of Goods Sold
2087
13.883
$28973.82
2087
$29497
Ending Inventory
279
13.883
$3873.36
Cost of Goods Sold
Units
Unit Cost
Total
Sales From Opening inventory
139
$11
$1529
Sales from Feb 20 Purchase
835
$13
$10855
Sales from Aug 12 Purchase
557
$15
$8355
Sales From May 5 Purchase
556
$14
$7784
2087
$28523
Ending Inventory
From May 5 Purchase
140
$14
$1960
From Dec 8 Purchases
139
$17
$2363
279
$4323
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