Penn Company uses a periodic inventory system. At the end of the annual accounti

Question

Penn Company uses a periodic inventory system. At the end of the annual accounting period, December 31 of the current year, the accounting records provided the following information for product 1: Units Unit Cost 1,930 $6 nventory, December 31, prior year For the current year: Purchase, March 21 Purchase, August 1 5,030 2,870 4,150 8 9 Inventory, December 31, current year Required: Compute ending inventory and cost of goods sold for the current year under FIFO, LIFO, and average cost inventory costing methods. (Round "Average cost per unit" to 2 decimal places and final answers to nearest whole dollar amount.) FIFO LIFO Average Cost Ending inventory Cost of goods sold

Explanation / Answer

Unit Unit cost Total Beg inv 1930 6 11580 Mar-21 5030 8 40240 Aug-01 2870 9 25830 Total 9830 77650 Average cost=77650/9830= 7.90 FIFO LIFO Average cost Ending inventory 36070 =(2870*9)+(1280*8) 29340 =(1930*6)+(2220*8) 32785 =4150*7.9 Cost of goods sold 41580 =77650-36070 48310 =77650-29340 44865 =77650-32785 Note: If average cost is not rounded off cost of goods sold will be $44872

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