Beech Soda, Inc. uses a perpetual inventory system. The company\'s beginning inv

Question

Beech Soda, Inc. uses a perpetual inventory system. The company's beginning inventory of a particular product and its purchases during the month of January were as follows: Quantity Unit Cost Total Cost Beginning inventory (Jan. 1) 21 $ 23 $ 483 Purchase (Jan. 11) 24 $ 29 696 Purchase (Jan. 20) 35 $ 31 1,085 Total 80 $ 2,264 On January 14, Beech Soda, Inc. sold 37 units of this product. The other 43 units remained in inventory at January 31. Assuming that Beech Soda uses the FIFO cost flow assumption, the 43 units of this product in inventory at January 31 have a total cost of: $1,295. $1,269. $1,864. $1,317. Assuming that Beech Soda uses the LIFO cost flow assumption, the 43 units of this product in inventory at January 31 have a total cost of: $1,317. $1,295. $1,269. $1,318.

Explanation / Answer

Assuming that Beech Soda uses the FIFO cost flow assumption, the 43 units of this product in inventory at January 31 have a total cost of $1,317.

Assuming that Beech Soda uses the LIFO cost flow assumption, the 43 units of this product in inventory at January 31 have a total cost of $1,269.

Inventory under FIFO Opening Inventory Purchases Issued Closing Inventory Date Qty Unit cost($) Total Cost ($) Qty Unit cost($) Total Cost ($) Qty Unit cost($) Total Cost ($) Qty Unit cost($) Total Cost ($) a b c d e f g h i j k (m=d+g -j) Jan, 01. 21 23 486 21 23 483 Jan,11. 21 23 483 24 29 696 24 29 696 Jan, 14 21 23 483 Jan, 14 16 29 464 Jan,20 8 29 232 35 31 1085 35 31 1085 Total Value 43 0 1317

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