Question

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Laker Company reported the following January purchases and sales data for its only product.

Date		Activities	Units Acquired at Cost								Units sold at Retail
Jan.	1	Beginning inventory	260	units	@	$	9.20	=	$	2,392
Jan.	10	Sales										145	units	@	$	17.20
Jan.	20	Purchase	330	units	@	$	8.20	=		2,706
Jan.	25	Sales										255	units	@	$	17.20
Jan.	30	Purchase	200	units	@	$	7.20	=		1,440
		Totals	790	units					$	6,538		400	units

Required:

The Company uses a perpetual inventory system. For specific identification, ending inventory consists of 390 units, where 200 are from the January 30 purchase, 80 are from the January 20 purchase, and 110 are from beginning inventory.

3.

Determine the cost assigned to ending inventory and to cost of goods sold using FIFO. (Round cost per unit to 2 decimal places.)

Perpetual FIFO:

Goods Purchased

Cost of Goods Sold

Inventory Balance

Date

# of units

Cost per unit

# of units sold

Cost per unit

Cost of Goods Sold

# of units

Cost per unit

Inventory Balance

January 1

260

@

$9.20

=

$2,392.00

January 10

January 20

January 25

January 30

Totals

Answer 1

Perpetual FIFO:
	Goods Purchased		Cost of Goods Sold
Date	# of units	Cost per unit	# of units sold	Cost per unit	Cost of Goods Sold	# of units	Cost per unit	Inventory Balance
1-Jan						260	9.2	2392
10-Jan			145	9.2	1334	115	9.2	1058
20-Jan	330	8.2				115	9.2	1058
						330	8.2	2706
								3764
25-Jan			115	9.2	1058
			140	8.2	1148	190	8.2	1558
								1558
30-Jan	200	7.2				190	8.2	1558
						200	7.2	1440
Totals					3540			2998