A company reports the following beginning inventory and two purchases for the mo

Question

A company reports the following beginning inventory and two purchases for the month of January. On January 26, the company sells 310 units. Ending inventory at January 31 totals 130 units Units Unit Cost Beginning inventory on January1 Purchase on January 9 Purchase on January 25 280 60 100 $ 2.60 2.80 2.94 Required Assume the periodic inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on the FIFO method # of | Cost per | units Cost of Goods | # of units sold of units Cost per Inventory Cost per Cost of r Ending Available for unit Goods Sold in ending unit unit Sale 280 2.609 728 Beg. Inventory Purchases January 9 January 25 60 100 440 2.80 2.94 168 294 1,190 Total

Explanation / Answer

DETERMINE COST ASSIGNED TO ENDING INVENTORY UNDER FIFO METHOD :

so ending inventory under periodic FIFO is 378

Periodic FIFO cost of goods available for sale Cost of goods sold Inventory balances # of units cost per unit cost of goods available for sale # of units sold cost per unit cost of goods sold # of units in ending inventory cost per unit ending inventory Beg inventory 280 2.60 728 280 2.60 728 Purchases January 9 60 2.80 168 30 2.8 84 30 2.8 84 Januray 25 100 2.94 294 100 2.94 294 Total 440 1190 310 812 130 378

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