Oahu Kiki tracks the number of units purchased and sold throughout each accounti
ID: 2518805 • Letter: O
Question
Oahu Kiki tracks the number of units purchased and sold throughout each accounting period but applies its inventory costing method at the end of each month, as if it uses a periodic inventory system. Assume Oahu Kiki’s records show the following for the month of January. Sales totaled 310 units.
Calculate the cost of ending inventory and cost of goods sold using the (a) FIFO, (b) LIFO, and (c) weighted average cost methods.
Oahu Kiki tracks the number of units purchased and sold throughout each accounting period but applies its inventory costing method at the end of each month, as if it uses a periodic inventory system. Assume Oahu Kiki’s records show the following for the month of January. Sales totaled 310 units.
Explanation / Answer
Ans.1 Number of units available for sale 800 Cost of goods available for sale 73600 *Calculation: Date Particulars Units Rate Cost 1-Jan Beginning inventory 240 80 19200 15-Jan Purchase 360 90 32400 24-Jan Purchase 200 110 22000 Total 800 73600 Ans.2 Number of units in ending inventory 490 *Calculation: Total units available for sale - Units sold 800 - 310 490 Ans.3 FIFO LIFO Weighted Average Cost of goods sold 25500 31900 28520 Cost of Ending inventory 48100 41700 45080 *FIFO Date Units Rate COGS Date Units Rate Ending inventory 1-Jan 240 80 19200 24-Jan 200 110 22000 15-Jan 70 90 6300 15-Jan 290 90 26100 310 25500 490 48100 *LIFO: Date Units Rate COGS Date Units Rate Ending inventory 24-Jan 200 110 22000 1-Jan 240 80 19200 15-Jan 110 90 9900 15-Jan 250 90 22500 310 31900 490 41700 *Weighted Average: Weighted average cost per unit = Cost of goods available for sale / Number of units available for sale 73600 / 800 92 Cost of goods sold = Weighted average unit cost * Units sold 92 * 310 28520 Cost of Ending inventory = Weighted Average cost per unit * Ending inventory units 92 * 490 45080
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