Problem 6-3A Groves Company Inc. had a beginning inventory of 100 units of Produ

Question

Problem 6-3A Groves Company Inc. had a beginning inventory of 100 units of Product MLN at a cost of $8 per unit. During the year, purchases were: Feb. 20 600 units at $9 Aug. 12 400 units at $11 May S 500 units at $10 Dec. 8 100 units at $12 Groves Company uses a periodic inventory system. Sales totaled 1,500 units (a) Determine the cost of goods available for sale The cost of goods available for sale s (b) Calculate Average Cost. (Round answer to 3 decimal places, e.g. 5.125.) Average Cost SHOW LIST OF ACCOUNTS LINK TO TEXT Determine the ending inventory and the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average-cost). (Round answers to O decimal places, e.g. 125.) IFO AVERAGE-COS The ending inventory The cost of goods sold

Explanation / Answer

1 Groves Company Inc. had a beginning inventory of 100 units of Product MLN at a cost of $8 per unit; 800 During the year, purchases were: 20-Feb 600 600*9 5400 12-Aug 500 500*10 5000 05-May 400 400*11 4400 08-Dec 100 100*12 1200 Total Purchases 1600 16000 Groves Company uses a periodic inventory system. Sales totaled 1500 units. Determine the cost of goods available for sale. = Cost at beginning + cost of purchases = 800+16000 = 16800 2 etermine the ending inventory and the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average cost). Total units available for sale = 100+1600 = 1700 Sales totaled = 1500, So ending Inventory = 1700-1500 = 200 uts Ending Inventory & COGS Under FIFO 05-May 100 100*12 1200 08-Dec 100 100*11 1100 Ending Inventory 2300 COGS 14500 LIFO Opening bal 100 100*8 800 20-Feb 100 100*9 900 Ending Inventory 1700 COGS 15100 average cost cost of goods available for sale 1700 uts for 16800 Average cost 9.88 Ending Inventory 200*9.88 1976.47 COGS 14823.53

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