Question

During the current period Gilligan made the following purchases of coconuts. Answer the questions below assuming that Gilligan uses the FIFO method for inventory costing.

Purchase 1 =	400 coconuts @ $2.80 each =
Purchase 2 =	600 coconuts @ $3.00 each =
Purchase 3 =	500 coconuts @ $3.20 each =
Total available for sale =

1.     Perform the multiplication above for each purchase and sum up the Total available for sale.

What is the total dollar amount available for sale?

2.     What would be the cost of goods sold if 800 coconuts were sold using FIFO? Show the units and cost per unit below (note not all rows in the table may be used).

	units @ $		=
	units @ $		=
			=
= Total cost of goods sold (COGS)

3.     What would be the ending inventory for the remaining coconuts? Show units and cost per unit.

	units @ $		=
	units @ $		=
			=
= Cost of ending inventory

Answer 1

1. Calculation Total dollar amount available for sale
Purchase 1 =	400 coconuts @ $2.80 each =	$1,120
Purchase 2 =	600 coconuts @ $3.00 each =	$1,800
Purchase 3 =	500 coconuts @ $3.20 each =	$1,600
Total available for sale =		$4,520
2. Calculation of cost of goods sold if 800 coconuts were sold using FIFO
Purchase 1 =	400 coconuts @ $2.80 each =	$1,120
Purchase 2 =	400 coconuts @ $3.00 each =	$1,200
Total cost of goods sold (COGS)=		$2,320
3. Calculation of ending inventory for the remaining coconuts
Purchase 2 =	200 coconuts @ $3.00 each =	$600
Purchase 3 =	500 coconuts @ $3.20 each =	$1,600
Cost of ending inventory =		$2,200