Chapter-7BarryBus21

During the period the company purchased inventory for

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Unformatted text preview: 0. During the period, the company purchased inventory for $10,200. The cost of goods sold for the period is $9,000. Compute the ending inventory. + = – = Cost of Goods Sold Calculation Beginning Inventory $ 4,800 Purchases 10,200 Cost of Goods Available for Sale 15,000 Cost of Goods sold 9,000 Ending Inventory $ 6,000 7 Cost of Goods Sold Equation Beginning Inventory $4,800 + Purchases $10,000 Goods Available for Sale $15,000 Ending Inventory $6,000 Cost of Goods Sold $9,000 (Balance Sheet) (Income Statement) 8 Inventory Costing Methods Specific Specific identification identification First-in, first-out (FIFO) Last-in, first-out (LIFO) Weighted average 9 10 11 12 Inventory Cost Flow Computations LIFO LIFO 10 units × $ 7 = $ 70 30 units × $ 8 = 240 10 units × $ 10 = 100 Cost of Goods Available for Sale $ 410 – Ending Inventory 110 Cost of Goods Sold $ 300 Beginning Inventory + Purchases (10 units @ $10) + (25 units @ $8) 13 14 15 16 17 Financial Statement Effect...
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