361470: Principles of Accounting (Online) > Syllabus | Conc WileyPLUS Weygandt,
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361470: Principles of Accounting (Online) > Syllabus | Conc WileyPLUS Weygandt, Accounting Principles, 13e Help I S CALCULATOR PRINTER VERSION BACK NEXT Exercise 6-06 (Video) Waterway Co. uses a periodic inventory system. Its records show the following for the month of May, in which 75 units were sold. Unit Units CostTotal Cost May 1 Inventory 36 15 Purchases 29 24 Purchases 32 Totals 97 $6 $216 261 320 $797 10 Compute the ending inventory at May 31 and cost of goods sold using the FIFO and LIFO methods FIFO LIFO Ending inventory at May 31 Cost of goods sold Click if you would like to Show Work for this question: Open Show Work LINK TO TEXT VIDEO: SIMILAR EXERCISE Question Attempts: 0 of 3 used SAVE FOR LATER SUBMIT ANSWEExplanation / Answer
Solution:
Periodic Inventory System
Periodic Inventory system is a system of inventory in which inventories are updated on a periodic basis. Periodic basis may be monthly, quarterly, weekly, half yearly or yearly. In this system, inventories are not kept up to date.
FIFO Periodic Method
FIFO method says the oldest units in stock are issued or sold first.
FIFO (Periodic)
Units
$/Unit
$$
Beginning Inventory May 1
36
$6
$216
Purchases May 15
29
$9
$261
Purchases May 24
32
$10
$320
Goods Available for Sale
97
$797
Cost of Goods Sold
Units
$/Unit
$$
Sale from Beginning Inventory
36
$6
$216
Sale from Purchases May 15
29
$9
$261
Sale from Purchases May 24
10
$10
$100
Total Cost of Goods Sold (B)
75
$577
Ending Inventory (A - B)
22
$220
LIFO Periodic Method
LIFO method says the newest units in stock are issued or sold first.
LIFO (Periodic)
Units
$/Unit
$$
Beginning Inventory May 1
36
$6
$216
Purchases May 15
29
$9
$261
Purchases May 24
32
$10
$320
Goods Available for Sale
97
$797
Cost of Goods Sold
Units
$/Unit
$$
Sale from Beginning Inventory
14
$6
$84
Sale from Purchases May 15
29
$9
$261
Sale from Purchases May 24
32
$10
$320
Total Cost of Goods Sold (B)
75
$665
Ending Inventory (A - B)
22
$132
Here, are the answers of the questions
FIFO
LIFO
Ending Inventory at May 31
$220
$132
Cost of goods sold
$577
$665
Hope the above calculations, working and explanations are clear to you and help you in understanding the concept of question.... please rate my answer...in case any doubt, post a comment and I will try to resolve the doubt ASAP…thank you
FIFO (Periodic)
Units
$/Unit
$$
Beginning Inventory May 1
36
$6
$216
Purchases May 15
29
$9
$261
Purchases May 24
32
$10
$320
Goods Available for Sale
97
$797
Cost of Goods Sold
Units
$/Unit
$$
Sale from Beginning Inventory
36
$6
$216
Sale from Purchases May 15
29
$9
$261
Sale from Purchases May 24
10
$10
$100
Total Cost of Goods Sold (B)
75
$577
Ending Inventory (A - B)
22
$220
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