Use the following data of Tortoise Sales Inc Units Sold Begi

Use the following data of Tortoise Sales, Inc. Units Sold Beginning inventory Purchase on Apr 25 Purchase on Nov 16 Sales Tortoise Sales\' average cost of ending inventory is Units 14 43 14 50 Unit Cost 3 Total Cost 42 215 112 A. $77 OB. $109. C. $147 OD, $400.

Solution

Answer

1.

Units

Unit Cost

Total

Beginning Inventory

                    14

3

              42

Purchases on April 25

                    43

                      5

           215

Purchases on Nov 16

                    14

                      8

           112

Total

                    71

           369

Average cost per unit =Total Cost / Total No. of Units

= 369 / 71

Average cost per unit = $5.197

Closing Inventory = Total Units – Sold Units

=21 Units (71 Units – 50 Units)

Cost of Closing Inventory = Average cost per unit * 21 Units

= $5.197 * 21 Units

Cost of Closing Inventory = $109.137

2.

FIFO means First-In-First-Out, It means the inventory which comes in goes out first.

Sales = 40 Units, That means 10 Units of Beginning Inventory is sold first and then 30 Units that is purchased on April 25.

Cost of Goods Sold

Units

Unit Cost

Total

Sales from Beginning Inventory

                    10

                      4

40

Sales from Purchased on April 25

                    30

                      7

210

Total

250

Cost of Goods Sold = $250

	Units	Unit Cost	Total
Beginning Inventory	14	3	42
Purchases on April 25	43	5	215
Purchases on Nov 16	14	8	112
Total	71		369