a company made purchases as\nfollows. find the inventory value using\nthree different methods.\nbeginning…

a company made purchases as\nfollows. find the inventory value using\nthree different methods.\nbeginning inventory 250 units at $1.50\njune 500 units at $1.60\njuly 670 units at $1.10\naugust 210 units at $1.15\nnow in inventory 390 units\nfind the inventory value using the weighted average method.\n$ 514.80\n(round to the nearest cent as needed.)\nfind the inventory value using the fifo method.\n$ \n(round to the nearest cent as needed )

a company made purchases as\nfollows. find the inventory value using\nthree different methods.\nbeginning inventory 250 units at $1.50\njune 500 units at $1.60\njuly 670 units at $1.10\naugust 210 units at $1.15\nnow in inventory 390 units\nfind the inventory value using the weighted average method.\n$ 514.80\n(round to the nearest cent as needed.)\nfind the inventory value using the fifo method.\n$ \n(round to the nearest cent as needed )

Answer

Explanation:

Step1: Calculate the total units and total cost

  • Total units: (250 + 500+670 + 210=1630) units
  • Total cost: (250\times1.50+500\times1.60 + 670\times1.10+210\times1.15) [ \begin{align*} &=375+800 + 737+241.5\ &=2153.5 \end{align*} ]

Step2: Use FIFO method

FIFO (First - In - First - Out) means the first units in are the first units out. So the 390 units in inventory come from the last - purchased units.

  • 210 units from August at ($1.15) per unit: (210\times1.15 = 241.5)
  • Remaining units: (390 - 210=180) units from July at ($1.10) per unit: (180\times1.10=198)
  • Total inventory value: (241.5 + 198=$439.5)

Answer:

($439.50)