Dugan Sales had the following transections for jackets in 2014, ts first year of

Question

Dugan Sales had the following transections for jackets in 2014, ts first year of operations: Jan. 20 Purchased 81 units $18 $1,458 Apr. 21 Purchased 496 units @ $20 = 9.920 July 25 Purchased 211 units $234,853 Sept. 19 Purchased 129 units @ $30 = 3.870 During the year, Dugan Sales sold 862 jackets for $56 each. value: 0.33 points Required a. Compute the amount of ending inventory Dugan would report on the balance sheet, assuming the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average. (Round intermediate calculations and final answers to nearest whole dollar amount.) LIFOWeighted Average FIFO Ending inventory

Explanation / Answer

CALCULATION OF COST OF ENDING INVENTORY AND COST OF GOODS SOLD UNDER FIFO METHOD Date Particulars Units (A) Rate Per unit Total Cost Units (A) January , 20 Purchases 81 18 1458 April, 21 Purchases 496 $20 9920 July , 25 Purchases 211 $23 4853 Septe, 19 Purchases 129 $30 3870 Total Available for sAles 917 20101 Average Cost = Total Price / Total Quantity = $21.92 SOLD 862 Ending inventory 55 Ending inventory As per FIFO 55 $30 $1,650 (Balance of inventory as on Sept , 19) Ending inventory As per LIFO 55 $18 $990 (Balance of inventory as on Jan, 20) Ending inventory As per Weighted Avg Cost Closing inventoy X Avg. Cost per unit = 55 units X $ 21.92 = $1,205.62 CALCULATION OF DIFFERENCE IN GROSS MARGIN IN FIFO AND LIFO FIFO LIFO DIFFERENCE Sales $48,272 $48,272 $0 Less: Cost of Goods Sold $18,451 $19,111 Gross Margin $29,821 $29,161 $660

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