Exercise 64 Waterway Corp sells a snowboard EZslide that is

Exercise 6-4 Waterway Corp. sells a snowboard, EZslide, that is popular with snowboard enthusiasts. Below is information relating to Waterway Corp.\'s purchases of EZslide snowboards during September. During the same month, 94 EZslide snowboards were sold. Waterway Corp. uses a periodic inventory system Units Explanation Inventory Purchases Purchases Purchases Totals Unit Cost Total Cost Date Sept. 1 Sept. 12 Sept. 19 Sept. 26 $107 110 13 46 45 20 124 $1,391 5,060 4,995 2,240 $13,686 112 (a) Compute the ending inventory at September 30 using the FIFO, LIFO and average-cost methods. (Round average cost per unit to 3 decimal places, e.g 125.153 and final answers to 0 decimal places, e.g. 125.) FIFO LIFO AVERAGE-COST The ending inventory at September 30 (b) Compute the cost of goods sold at September 30 using the FIFO, LIFO and average-cost methods. (Round average cost per unit to 3 decimal places, e.g 125.153 and final answers to 0 decimal places, e.g. 125.) FIFO LIFO AVERAGE-COST Cost of goods sold

Solution

Units available for sale = 13 + 46 + 45 + 20 = 124

Units for Ending Inventory = Units available for sale - Units sold

= 124 - 94 = 30 units

Average cost per unit = $13,686 / 124 = $110.37

a. Computation of ending Inventory at September 30

FIFO = (20 x $112) + (10 x $111) = $3,350

LIFO = (13 x $107) + (17 x $110) = $3,261

Avaerage cost = 30 x $110.37 = $3,311.1

b.Computation of cost of goods sold at september 30

FIFO = (13 x $107) + (46 x $110) + (35 x $111) = $10,336

LIFO = (20 x $112) + (45 x $111) + (29 x $110) = $10,425

Average Cost = 94 x $110.37 = $10,374.78

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