Question

computing Cost of Goods Sold and Ending Inventory
Bartov Corporation reports the following beginning inventory and purchases for 2017

Beginning inventory	400	@	$12	each	$4,800
Inventory purchased	600	@	$14	each	8,400
Cost of goods available	1,000	units			$13,200

Bartov sells 600 of these units in 2017. Compute its cost of goods sold for 2017 and the ending inventory reported on its 2017 balance sheet under each of the following inventory costing methods:

(Do not round until your final answer. Round to the nearest whole number.)

		FIFO	LIFO	Average cost
Cost of goods sold		Answer	Answer	Answer
Ending inventory		Answer	Answer	Answer

Answer 1

Closing inventory =400+600-600 = 400 units

FIFO method

COST OF GOODS SOLD (400 * $12 + 200 * $14) = $7600

Ending inventory (400 * $14) = $5600

LIFO method

COST OF GOODS SOLD (600 * $14) = $8400

Ending inventory (400 * $12) = $4800

Average cost method:

Total cost / No of units = $13,200/1000 = $13.2/unit

COST OF GOODS SOLD =$13.2 * 600= $7920

Ending inventory $13.2 * 400 = $5280

FIFO LIFO AVERAGE COST

Cost of goods sold $7600 $8400 $7920

Ending inventory $5600 $4800 $5280