rei sells snowboards. assume the following information relates to reis purchases of snowboards during…

rei sells snowboards. assume the following information relates to reis purchases of snowboards during september. during the same month, 102 snowboards were sold. rei uses a periodic inventory system.\ndate explanation units unit cost total cost\nsept. 1 inventory 12 $100 $1,200\nsept. 12 purchases 45 103 4,635\nsept. 19 purchases 50 104 5,200\nsept. 26 purchases 20 105 2,100\ntotals 127 $13,135\n(a)\ncompute the ending inventory at september 30 using fifo, lifo, and average - cost. (round average cost per unit to 3 decimal places, e.g. 125.153 and final answers to 0 decimal places, e.g. 125.)\nfifo lifo average - cost\nending inventory at september 30 $ $ $

rei sells snowboards. assume the following information relates to reis purchases of snowboards during september. during the same month, 102 snowboards were sold. rei uses a periodic inventory system.\ndate explanation units unit cost total cost\nsept. 1 inventory 12 $100 $1,200\nsept. 12 purchases 45 103 4,635\nsept. 19 purchases 50 104 5,200\nsept. 26 purchases 20 105 2,100\ntotals 127 $13,135\n(a)\ncompute the ending inventory at september 30 using fifo, lifo, and average - cost. (round average cost per unit to 3 decimal places, e.g. 125.153 and final answers to 0 decimal places, e.g. 125.)\nfifo lifo average - cost\nending inventory at september 30 $ $ $

Answer

Explanation:

Step1: Calculate number of ending - inventory units

The total number of units available for sale is 127 and 102 units were sold. So, the number of ending - inventory units is $127 - 102=25$ units.

Step2: FIFO (First - In, First - Out)

Under FIFO, the ending inventory consists of the most recently purchased units. The last purchase on Sept. 26 was 20 units at $105 per unit and we need 25 units, so we take all 20 from Sept. 26 and 5 from the Sept. 19 purchase. The cost of the ending inventory is $(20\times105)+(5\times104)=2100 + 520=$2620$.

Step3: LIFO (Last - In, First - Out)

Under LIFO, the ending inventory consists of the earliest purchased units. We start with the beginning inventory of 12 units at $100 per unit and then take the remaining $25 - 12 = 13$ units from the Sept. 12 purchase. The cost of the ending inventory is $(12\times100)+(13\times103)=1200+1339=$2539$.

Step4: Average - cost

The average cost per unit is $\frac{13135}{127}\approx103.425$ (rounded to 3 decimal places). The cost of the ending inventory is $25\times103.425=$2586$ (rounded to 0 decimal places).

Answer:

FIFO: $2620 LIFO: $2539 AVERAGE - COST: $2586