Penn Company uses a periodic inventory system. At the end of the annual accounti

Question

Penn Company uses a periodic inventory system. At the end of the annual accounting period, December 31 of the current year, the accounting records provided the following information for product 1 Units Unit Cost nventory, Dber 31, prior year 1,910 $4 For the current year: Purchase, March 21 Purchase, August 1 5,140 2,890 4,200 nventory, December 31, current year Required: Compute ending inventory and cost of goods sold for the current year under FIFO, LIFO, and average cost inventory costing methods. (Round "Average cost per unit" to 2 decimal places and final answers to nearest whole dollar amount.) FIFO LIFO Average Cost Ending inventory Cost of goods sold

Explanation / Answer

Calculate ending inventory and cost of goods sold :

FIFO LIFO Average cost Cost of goods available for sale 58710 58710 58710 Ending inventory (2890*7+1310*6) = 28090 (1910*4+2290*6) = 21380 (58710/9940*4200) = 24807 Cost of goods sold (58710-28090) = 30620 (58710-21380) = 37330 (58710-24807) = 33903

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