Inventory Costing MethodsPerpetual Method Fortune Stores use

Inventory Costing Methods-Perpetual Method Fortune Stores uses the perpetual inventory system for its merchandise inventory. The April 1 inventory for one of the items in the merchandise inventory consisted of 120 units with a unit cost of $395. Transactions for this item during April were as follows: April 9 Purchased 40 units $415 per unit 14 Sold 80 uits @620 per unit 23 Purchased 20 units 420 per unit 29 Sold 40 umits Required a. Calculate the cost of goods sold and the ending inventory cost for the month of April using the weighted-average cost method. Do not round until your final answers. Round your final answers to the nearest dollar. b. Calculate the cost of goods sold and the ending inventory cost for the month of April using the first-in, first-out method c. Calculate the cost of goods sold and the ending inventory cost for the month of April using the last-in, first-out method a Weighted Average Ending Inventory Cost of goods Sold b. First-in, First-out: Ending Inventory Cost of Goods Sold: $A c Last-in, first-out Ending Inventory Cost of Goods Sold:

Solution

Units Rate Value Beg Bal 120 395 47400 Purchase 40 415 16600 Purchase 20 420 8400 180 72400 Average Rate=72400/180 402.22 Weighted Average Ending Inventory =(180-120)*402.22 24133.33 Cost of Goods sold =120*402.22 48266.67 First in First out Ending Inventory =20*420 ,20*415 16700 Cost of Goods sold=72400-16700 55700 Last in first out Ending Inventory =40*395 15800 Cost of Goods sold=72400-15800 56600