Question

Exercise 6-6

Sunland Company uses a periodic inventory system. Its records show the following for the month of May, in which 104 units were sold.

				Units			Unit Cost			Total Cost
May 1		Inventory		48			$14			$672
15		Purchases		40			17			680
24		Purchases		56			18			1,008
		Totals		144						$2,360

a. Compute the ending inventory at May 31 and cost of goods sold using the FIFO and LIFO methods.

Answer 1

Computation of Cost of Goods Sold & Inventory as per FIFO
Cost of Goods Sold
No. of Unit Sod:- 104 Unit
48 UnitX $14	$672.00
40 UnitX $17	$680.00
16 Unit X $ 18	$288.00
Cost of Goods Sold	$1,640.00
Ending Inventory
40 Unti X $18	$720.00

Computation of Cost of Goods Sold & Inventory as per LIFO
Cost of Goods Sold
No. of Unit Sod:- 104 Unit
56 UnitX $18	$1,008.00
40 UnitX $17	$680.00
8 Unit X $ 14	$112.00
Cost of Goods Sold	$1,800.00
Ending Inventory
40 Unti X $14	$560.00