Salandra Inc. buys engines, and then installs them in dirt bikes for weekend rac

Question

Salandra Inc. buys engines, and then installs them in dirt bikes for weekend race enthusiasts. Inventory records of the engines for 2015 are shown below DATE UNITS PER UNIT COST TOTAL COST 1/1 Beginning Inventory 150 $120 $18,000 1/2 Bought 80 $124 $9,920 2/4 Sold (96) 4/8 Bought 100 $132 $13,200 5/15 Bought 160 $136 $21,760 7/20 Sold (200) 9/16 Bought 240 $140 $33,600 11/23 Sold (400) 12/10 Bought 180 $144 $25,920 12/22 Sold (60) Cost of Goods Available for Sale $122,400 Units Available for Sale (BI + units bought) 910 units Units Sold 756 units Ending Inventory 154 units NOTE: Results for FIFO are the same whether the periodic or perpetual system is in place. It is not repeated here. Part a. Assuming the Perpetual System and LIFO, calculate Cost of Goods Sold and Ending Inventory Sales (756 units): HINT: CGS for each sale must be calculated based on inventory on hand when the sale occurred. Units Cost per unit Total 2/4 sale: 7/20 sale: 11/23 sale 12/22 sale Total CGS Ending Inventory (154 units): Part b. Assuming the Periodic System and WA, calculate Cost of Goods Sold and Ending Inventory HINT: Calculate average cost per unit before each sale first and carry out average cost to 5 decimal places to avoid rounding errors and determine ending inventory after each sale Sales (756 units) CGAS on 2/4 Cost per unit on 2/4 2/4 sale: Units Cost per unit Total 7/20 sale: CGAS on 7/20 Cost per unit on 7/20 11/23 sale CGAS on 11/23 Cost per unit on 11/23 12/22 sale CGAS on 12/22 Cost per unit on 12/22 Total CGS Ending Inventory (154 units) Salandra Inc. buys engines, and then installs them in dirt bikes for weekend race enthusiasts. Inventory records of the engines for 2015 are shown below DATE UNITS PER UNIT COST TOTAL COST 1/1 Beginning Inventory 150 $120 $18,000 1/2 Bought 80 $124 $9,920 2/4 Sold (96) 4/8 Bought 100 $132 $13,200 5/15 Bought 160 $136 $21,760 7/20 Sold (200) 9/16 Bought 240 $140 $33,600 11/23 Sold (400) 12/10 Bought 180 $144 $25,920 12/22 Sold (60) Cost of Goods Available for Sale $122,400 Units Available for Sale (BI + units bought) 910 units Units Sold 756 units Ending Inventory 154 units NOTE: Results for FIFO are the same whether the periodic or perpetual system is in place. It is not repeated here. Part a. Assuming the Perpetual System and LIFO, calculate Cost of Goods Sold and Ending Inventory Sales (756 units): HINT: CGS for each sale must be calculated based on inventory on hand when the sale occurred. Units Cost per unit Total 2/4 sale: 7/20 sale: 11/23 sale 12/22 sale Total CGS Ending Inventory (154 units): Part b. Assuming the Periodic System and WA, calculate Cost of Goods Sold and Ending Inventory HINT: Calculate average cost per unit before each sale first and carry out average cost to 5 decimal places to avoid rounding errors and determine ending inventory after each sale Sales (756 units) CGAS on 2/4 Cost per unit on 2/4 2/4 sale: Units Cost per unit Total 7/20 sale: CGAS on 7/20 Cost per unit on 7/20 11/23 sale CGAS on 11/23 Cost per unit on 11/23 12/22 sale CGAS on 12/22 Cost per unit on 12/22 Total CGS Ending Inventory (154 units)

Explanation / Answer

LIFO Qty Rate Amt. 04-Feb 80 124         9,920 16 120         1,920 20-Jul 160 136       21,760 40 132         5,280 23-Nov 240 140       33,600 60 132         7,920 100 120       12,000 22-Dec 60 144         8,640 Total 756     101,040 CoGS for 756 is 101040 Closing inventoty 34 120         4,080 120 144       17,280 Total 154       21,360 Weighted Average QTY Rate Amt 04-Feb 96       121.39       11,654 20-Jul 200       130.02       26,003 23-Nov 400 135.54       54,215 22-Dec 60       142.66         8,559 Total 756     100,431 CoGS for 756 is 10431 Closing inventoty 154       142.66       21,969

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