Question

Novak Corp. sells a snowboard, EZslide, that is popular with snowboard enthusiasts. Below is information relating to Novak Corp.’s purchases of EZslide snowboards during September. During the same month, 107 EZslide snowboards were sold. Novak Corp. uses a periodic inventory system. Date Explanation Units Unit Cost Total Cost Sept. 1 Inventory 13 $117 $ 1,521 Sept. 12 Purchases 46 120 5,520 Sept. 19 Purchases 60 121 7,260 Sept. 26 Purchases 21 122 2,562 Totals 140 $16,863 (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 $Enter a dollar amount Entry field with incorrect answer now contains modified data $Enter a dollar amount Entry field with incorrect answer now contains modified data $Enter a dollar amount Entry field with incorrect answer now contains modified data (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 $Enter a dollar amount Entry field with incorrect answer now contains modified data $Enter a dollar amount Entry field with incorrect answer now contains modified data $Enter a dollar amount Entry field with incorrect answer now contains modified data

Answer 1

Date	Unit	Unit cost	Total cost
Sept 1	13	$117	$1,521
Sept 12	46	120	5,520
Sept 19	60	121	7,260
Sept 26	21	122	2,562
Total	140		$16,863

Units in ending inventory = 140 - 107 = 33 units

Average cost per unit = $16,863 / 140 = $120.45 per unit

a.

	FIFO	LIFO	Average cost
Cost of ending inventory	$4,014 [($2,562+(12*$121)]	$3,921 [(1,521+(20*$120)]	$3,975 (33*$120.45)

b.

	FIFO	LIFO	Average cost
Cost of goods sold	$12,849 ($16,863-4,014)	$12,942 ($16,863-3,921)	$12,888 ($16,863-3,975)