Question

Inventory information for Part 311 of Pina Corp. discloses the following information for the month of June.

June 1		Balance		299 units @ $16		June 10		Sold		196 units @ $38
11		Purchased		803 units @ $19		15		Sold		502 units @ $40
20		Purchased		505 units @ $21		27		Sold		297 units @ $43

(a)

Assuming that the periodic inventory method is used, compute the cost of goods sold and ending inventory under (1) LIFO and (2) FIFO.

		(1) LIFO		(2) FIFO
Cost of Goods Sold		$		$
Ending Inventory		$

Answer 1

Total units available for sale = 299+803+505 = 1607 units

Total units sold = 196+502+297 = 995 units

Ending inventory (units) = Total units available for sale - Total units sold

= 1607 units - 995 units = 612 units

Total cost of goods available for sale = 299*16+803*19+505*21 = $30,646

LIFO:

Cost of Goods Sold = 505*21+(995-505)*19 = $19,915

Ending inventory =  Total cost of goods available for sale - Cost of Goods Sold

= $30646 - $19915 = $10,731

FIFO:

Cost of Goods Sold = 299*16+(995-299)*19 = $18,008

Ending inventory =  Total cost of goods available for sale - Cost of Goods Sold

= $30646 - $18008 = $12,638