(appendix 6b) inventory costing methods: periodic fifo\nfilimonov inc. has the following information related…

(appendix 6b) inventory costing methods: periodic fifo\nfilimonov inc. has the following information related to purchases and sales of one of its inventory items:\n\nassume that filimonov uses a periodic inventory system.\n\nrequired:\ncalculate the cost of goods sold and the cost of ending inventory using the fifo inventory costing method.\ncost of goods sold\n$\ncost of ending inventory\n$

(appendix 6b) inventory costing methods: periodic fifo\nfilimonov inc. has the following information related to purchases and sales of one of its inventory items:\n\nassume that filimonov uses a periodic inventory system.\n\nrequired:\ncalculate the cost of goods sold and the cost of ending inventory using the fifo inventory costing method.\ncost of goods sold\n$\ncost of ending inventory\n$

Answer

Explanation:

Step1: Calculate total units available for sale

Total units = Beginning inventory units + Purchase 1 units + Purchase 2 units Total units = (150+200 + 250=600) units

Step2: Calculate total units sold

Total units sold = Sale 1 units+Sale 2 units Total units sold=(300 + 225=525) units

Step3: Calculate units in ending inventory

Units in ending inventory=Total units - Total units sold Units in ending inventory=(600 - 525 = 75) units

Step4: Calculate cost of goods sold using FIFO

Under FIFO, we sell the oldest units first.

  • From beginning inventory: (150) units at ($10) per unit. Cost=(150\times10=$1500)
  • From Purchase 1: (200) units at ($12) per unit. Cost=(200\times12=$2400)
  • From Purchase 2: Units sold from Purchase 2=(525-(150 + 200)=175) units. Cost=(175\times14=$2450) Cost of goods sold=(1500+2400 + 2450=$6350)

Step5: Calculate cost of ending inventory using FIFO

Ending inventory units ((75)) come from Purchase 2 (since we sold from oldest to newest) Cost of ending inventory=(75\times14=$1050)

Answer:

Cost of goods sold: ($6350) Cost of ending inventory: ($1050)