Question & Answer: Calculate Cost of Ending Inventory and Cost of Goods Sold under Periodic FIFO, LIFO, a…..

Calculate Cost of Ending Inventory and Cost of Goods Sold under Periodic FIFO, LIFO, and Weighted Average Cost

Spotter Corporation reported the following for June in its periodic inventory records.

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Date		Description	Units	Unit Cost		Total Cost
June	1	Beginning	12	$	8	$	96
	11	Purchase	38		9		342
	24	Purchase	20		11		220
	30	Ending	24

Expert Answer

Units in Beginning Inventory = 12

Number of units purchased = 38 + 20
Number of units purchased = 58

Units in Ending Inventory = 24

Number of units Available for Sale = Units in Beginning Inventory + Number of units purchased
Number of units Available for Sale = 12 + 58
Number of units Available for Sale = 70

Number of units sold = Number of units Available for Sale – Units in Ending Inventory
Number of units sold = 70 – 24
Number of units sold = 46

Cost of Goods Available for Sale = Cost of Beginning Inventory + Cost of Goods Purchased
Cost of Goods Available for Sale = $96 + $342 + $220
Cost of Goods Available for Sale = $658

LIFO:

Cost of Goods Sold = 20 * $11 + 26 * $9
Cost of Goods Sold = $454

Ending Inventory = 12 * $8 + 12 * $9
Ending Inventory = $204

FIFO:

Cost of Goods Sold = 12 * $8 + 34 * $9
Cost of Goods Sold = $402

Ending Inventory = 4 * $9 + 20 * $11
Ending Inventory = $256

Weighted-average Cost:

Cost of Goods Available for Sale = $658
Number of units Available for Sale = 70

Weighted Average Cost per unit = $658 / 70
Weighted Average Cost per unit = $9.40

Cost of Goods Sold = 46 * $9.40
Cost of Goods Sold = $432.40

Ending Inventory = 24 * $9.40
Ending Inventory = $225.60