(a) (b) Teal Company sells two types of pumps. One is large and is for commercia
ID: 2525372 • Letter: #
Question
(a)
(b)
Teal Company sells two types of pumps. One is large and is for commercial use. The other is smaller and is used in residential swimming pools. The following inventory data is available for the month of March.Units Price per
Unit Total Residential Pumps Inventory at Feb. 28: 210 $ 380 $ 79,800 Purchases: March 10 510 $ 450 $ 229,500 March 20 380 $ 470 $ 178,600 March 30 300 $ 490 $ 147,000 Sales: March 15 510 $ 530 $ 270,300 March 25 380 $ 560 $ 212,800 Inventory at March 31: 510 Commercial Pumps Inventory at Feb. 28: 600 $ 810 $ 486,000 Purchases: March 3 600 $ 890 $ 534,000 March 12 320 $ 950 $ 304,000 March 21 510 $ 1,000 $ 510,000 Sales: March 18 910 $ 1,080 $ 982,800 March 29 610 $ 1,140 $ 695,400 Inventory at March 31: 510
Explanation / Answer
Cost of Ending Inventory (by using LIFO Method):-
Residential Pumps: [ (210x380) + (300x450) ] = $ 214800
Commercial Pumps: [ 510x810 ] = $ 413100
Total Cost pf Inventory = (214800 + 413100) = $ 627900
Cost of Goods Sold = Opening Inventory Value + Purchase Value - Closing Inventory Value
Residential Pumps = (79800 + 555100 - 214800) = $ 420100
Commercial Pumps = (486000 + 1348000 - 413100) = $ 1420900
Total Cost of Goods Sold = (420100 + 1420900) = $ 1841000
Price Index = Cost of Inventory at Most Recent Prices / Cost of Inventory at Base Prices
Residential Pumps = ( 510x490) / (510x380) = 1.289
Commercial Pumps = (510x1000) / (510x810) = 1.235
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.