Question

Evans Company had the following information for the year ending December 31:

Beginning inventory: 210 Units $45 Unit Cost

Purchase April 6: 360 Units $43 Unit Cost

Sale May 4: 260 Units   

Purchase July 19: 480 units $42 unit cost

Sale: September 9: 380 units

Purchase: October 10: 100 units $39 unit cost

Evans uses the perpetual inventory system and the FIFO method. Required: Using FIFO (a) Compute the cost of ending inventory. (b) Compute the cost of goods sold for the year.

Cost of ending inventory $

Cost of goods sold $

Answer 1

Cost of ending inventory = $21120
Cost of goods sold = $27870
Workings:
	Cost of goods available for sale			Cost of goods sold			Ending inventory
Beginning inventory	210	45	9450	210	45	9450
Purchases:
April 6:	360	43	15480	360	43	15480
July 19:	480	42	20160	70	42	2940	410	42	17220
October 10:	100	39	3900				100	39	3900
Total	1150		48990	640		27870	510		21120
Units sold = 260+380 = 640
Ending imventory units = 1150-640 = 510