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14 March, 03:54

Periodic Inventory Using FIFO, LIFO, and Weighted Average Cost Methods The units of an item available for sale during the year were as follows: Jan. 1 Inventory 14 units at $36 $504 Aug. 7 Purchase 19 units at $38 722 Dec. 11 Purchase 14 units at $40 560 47 units $1,786 There are 20 units of the item in the physical inventory at December 31. The periodic inventory system is used. Determine the inventory cost using (a) the first-in, first-out (FIFO) method; (b) the last-in, first-out (LIFO) method; and (c) the weighted average cost method (round per unit cost to two decimal places and your final answer to the nearest whole dollar).

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  1. 14 March, 04:03
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    (a) the first-in, first-out (FIFO) method; $1054

    (b) the last-in, first-out (LIFO) method; $998 and

    (c) the weighted average cost method $760

    Explanation:

    FIFO

    Inventory; 13 units * $38 = $494

    14 units * $40 = $560

    Total = $1054

    LIFO

    Inventory; 13 units * $38 = $494

    14 units * $36 = $504

    Total = $998

    weighted average cost

    August 7

    New Cost per Unit = ((14 units * $36) + (19 units * $38)) / (14 units + 19 units)

    = $37.15

    December 11

    New Cost per Unit = ((33 units * $37.15) + (14 units * $40)) / (33 units+14units)

    = $38.00

    Inventory Cost = 20 units * $38.00

    = $760
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Home » Business » Periodic Inventory Using FIFO, LIFO, and Weighted Average Cost Methods The units of an item available for sale during the year were as follows: Jan. 1 Inventory 14 units at $36 $504 Aug. 7 Purchase 19 units at $38 722 Dec.
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