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Concord Corporation uses a periodic inventory system and reports the following for the month of June:

| Date | Explanation | Units | Unit Cost | Total Cost |
|---------|-------------|-------|-----------|------------|
| June 1 | Inventory | 110 | [tex]$5 | $[/tex]550 |
| June 12 | Purchase | 350 | [tex]$6 | $[/tex]2,100 |
| June 23 | Purchase | 190 | [tex]$7 | $[/tex]1,330 |
| June 30 | Inventory | 193 | | |

(a) Compute the cost of the ending inventory and the cost of goods sold under FIFO, LIFO, and average-cost. (Round per unit cost to 3 decimal places, e.g., 15.647, and final answers to 0 decimal places, e.g., 5,125.)

| | | FIFO | | LIFO | | Average-cost | |
|---------------|-------|------|-------|------|-------|--------------|-------|
| Cost of the ending inventory | [tex]$ | | $[/tex] | | [tex]$ | |
| Cost of goods sold | $[/tex] | | [tex]$ | | $[/tex] | |

Sagot :

GinnyAnswer
Certainly! Let's calculate the cost of ending inventory and cost of goods sold (COGS) using the FIFO, LIFO, and Average-Cost methods step by step.

### Given Data
- Beginning Inventory: 110 units at [tex]$5 per unit - Purchase on June 12: 350 units at $[/tex]6 per unit
- Purchase on June 23: 190 units at [tex]$7 per unit - Ending Inventory: 193 units ### 1. Calculating FIFO (First-In, First-Out) Under FIFO, the first units purchased are the first ones sold. Therefore, the ending inventory consists of the most recently purchased units. #### Cost of Ending Inventory (FIFO) 1. June 23 purchase: - Ending inventory units: 193 - Units from June 23: 190 units at $[/tex]7 each
- Total cost from June 23: [tex]\(190 \times 7 = \$1,330\)[/tex]

2. Remaining units:
- Remaining units after June 23: [tex]\(193 - 190 = 3\)[/tex] units
- Units from June 12: 3 units at [tex]$6 each - Total cost from June 12: \(3 \times 6 = \$[/tex]18\)

3. Total cost of ending inventory (FIFO):
- [tex]\( \$1,330 + \$18 = \$1,348 \)[/tex]

#### Cost of Goods Sold (FIFO)
1. Total available units for sale:
- Beginning Inventory: 110 units
- June 12 purchase: 350 units
- June 23 purchase: 190 units
- Total: [tex]\( 110 + 350 + 190 = 650 \)[/tex] units

2. Units sold:
- [tex]\( 650 - 193 = 457 \)[/tex] units

3. Cost of units sold under FIFO:
- Beginning Inventory: 110 units at [tex]$5 = \$[/tex]550
- June 12 purchase: 350 units at [tex]$6 = \$[/tex]2,100
- Remaining units from June 23: [tex]\( 457 - 460 = 3 \times 7 = \$21 \)[/tex]
- Total cost of goods sold (FIFO): [tex]\( 550 + 2,100 + 21 = \$2,632 \)[/tex]

### 2. Calculating LIFO (Last-In, First-Out)

Under LIFO, the last units purchased are the first ones sold. Therefore, the ending inventory consists of the earliest purchased units.

#### Cost of Ending Inventory (LIFO)
1. Beginning inventory:
- 110 units at [tex]$5 each - Total cost from beginning inventory: \( 110 \times 5 = \$[/tex]550 \)

2. Remaining units:
- Remaining units after the beginning inventory: [tex]\( 193 - 110 = 83 \units \)[/tex]
- Units from June 12: 83 units at [tex]$6 each - Total cost from June 12: \( 83 \times 6 = \$[/tex]498 \)

3. Total cost of ending inventory (LIFO):
- [tex]\( \$550 + \$498= \$1,048 \)[/tex]

#### Cost of Goods Sold (LIFO)
1. Cost of units sold under LIFO:
- June 23 purchase: 190 units at [tex]$7 = \$[/tex]1,330
- June 12 purchase: 350 units at [tex]$6 = \$[/tex]2,100
- Remaining cost from Beginning Inventory: [tex]\( 457 - 540 = 53 \times 5 = \$265 \)[/tex]
- Total cost of goods sold (LIFO): [tex]\( 1,330 + 2,100 + 265 = \$2,932 \)[/tex]

### 3. Calculating Average-Cost

The average-cost method uses the weighted average of all units available for sale during the period.

#### Average Cost per Unit:
1. Total cost:
- Beginning Inventory: 110 units at [tex]$5 = \$[/tex]550
- June 12 purchase: 350 units at [tex]$6 = \$[/tex]2,100
- June 23 purchase: 190 units at [tex]$7 = \$[/tex]1,330
- Total cost: [tex]\( \$550 + \$2,100 + \$1,330 = \$3,980 \)[/tex]

2. Total units:
- 110 + 350 + 190 = 650 units

3. Average cost per unit:
- [tex]\( \$3,980 / 650 \approx \$6.123 \)[/tex]

#### Cost of Ending Inventory (Average-Cost)
1. Ending inventory units: 193 units
2. Total cost: [tex]\( 193 \times \$6.123 \approx \$1,182 \)[/tex]

#### Cost of Goods Sold (Average-Cost)
1. Units sold: 457 units
2. Total cost: [tex]\( 457 \times \$6.123 \approx \$2,798 \)[/tex]

### Summary:
[tex]\[ \begin{tabular}{|c|c|c|c|c|} \hline & FIFO & LIFO & Average-Cost \\ \hline \text{Cost of the ending inventory} & \$1,348 & \$1,048 & \$1,182 \\ \hline \text{Cost of goods sold} & \$2,632 & \$2,932 & \$2,798 \\ \hline \end{tabular} \][/tex]

Therefore, the cost of ending inventory and the cost of goods sold under each method are:

1. FIFO:
- Ending Inventory: \[tex]$1,348 - Cost of Goods Sold: \$[/tex]2,632

2. LIFO:
- Ending Inventory: \[tex]$1,048 - Cost of Goods Sold: \$[/tex]2,932

3. Average-Cost:
- Ending Inventory: \[tex]$1,182 - Cost of Goods Sold: \$[/tex]2,798
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