CALCULATOR PRINTER VERSION BACK NEXT Exercise 8-13 Presented below is informatio

Question

CALCULATOR PRINTER VERSION BACK NEXT Exercise 8-13 Presented below is information related to Blowfish radios for the Larkspur Company for the month of July Date Transaction Units In Unit Cost Total Units Sold Selling Price Total uly 1 Balance 120 $3.80 456 3,744 6 Purchase 960 3.90 360 $7.00 $2,520 2,628 7 Sale 10 Sale 12 Purchase 15 Sale 18 Purchase 22 Sale 25 Purchase 30 Sale 360 7.30 480 4.20 2,016 240 7.40 1,776 360 4.30 1,548 480 7.40 3,552 600 4.28 2,568 240 7.50 1,800 Totals 2,520 $10,332 1,680 $12,276 Calculate average cost per unit. (Round answer to 2 decimal places, e.g. 2.76.) Weighted-average cost LINK TO TEXT

Explanation / Answer

Weighted-average cost = $10332/2520 units = $4.10

Ending inventory = (Beginning inventory + Purchases) - Sales = 2520 - 1680 = 840 units

(1) FIFO Ending inventory = (600 x $4.28) + (240 x $4.30) = $2568 + $1032 = $3600

(2) LIFO Ending inventory = (120 x $3.80) + (720 x $3.90) = $456 + $2808 = $3264

(3) Weighted average Ending inventory = 840 x $4.10 = $3444

LIFO method will yield the lowest gross profit.

LIFO method will yield the lowest ending inventory.

(1) (2) (3) FIFO LIFO Weighted-Average Ending Inventory at July 31 $3600 $3264 $3444

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