Respuesta :
Answer and Explanation:
The computation is shown below:-
Units sold = Opening balance + Purchase in march + Purchase in August - Closing balance
= 2,000 + 5,000 + 3,000 - 4,000
= 6,000
1. FIFO method:
So total cost of goods sold is (2000 × $5) + (4,000 × $6)
= $34,000
Ending inventory value is
= (1000 × 6) + (3000 × $8)
= $30,000
2. LIFO method:
Total value of goods sold is
= (3,000 × $8) + (3,000 × $6)
= $42,000
Ending inventory value is
(2,000 × 6) + (2000 × $5)
= $22,000
3. Average cost of inventory
Opening inventory + Purchase on Mar.21 + Purchase on Aug.1
(2,000 × $5) + (5000 × $6) + (3000 × 8)
= $64,000.
Total units is
= 2,000 + 5,000 + 3,000
= 10,000
Average cost is
= $64,000 ÷ 10,000
= $6.40 per units.
Now,
Cost of goods sold is 6,000 × $6.40
= $38,400
Ending Inventory value is
= 4,000 × $6.40
= $25,600
The computation of the ending inventory and the cost of goods sold for the year under the three inventory costing methods is as follows:
FIFO LIFO WEIGHTED-AVERAGE
Ending inventory $22,000 $27,000 $24,400
Cost of goods sold $39,000 $34,000 $36,600
Data and Calculations:
Units Unit Cost Total Costs
December 31, Inventory 2,000 $5 $10,000
March 21 Purchase 5,000 $6 $30,000
March 21 Purchase 3,000 $8 $21,000
Total 10,000 $61,000
Average cost per unit = $6.10 ($61,000/10,000)
December 31, Inventory 4,000
Units sold = 6,000 (10,000 - 4,000) units
FIFO:
Ending inventory = $22,000 (2,000 x $6 + 2,000 x $5)
Cost of goods sold = $39,000 ($61,000 - $22,000)
LIFO:
Ending inventory = $27,000 (1,000 x $6 + 3,000 x $8)
Cost of goods sold = $34,000 ($61,000 - $27,000)
Weighted Average:
Ending inventory = $24,400 (4,000 x $6.10)
Cost of goods sold = $36,600 (6,000 x $6.10)
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