Calculate cost of goods sold and ending inventory amounts

Question

Problem 1

Mower-Blower Sales Co. started business on January 20, 2013. Products sold were snow blowers and lawn mowers. Each product sold for $350. Purchases during 2013 were as follows:

 

	Blowers				Mowers
January 21	23	@	$	192
February 3	45	@		194
February 28	38	@		190
March 13	19	@		195
April 6					20	@	$	211
May 22					50	@		212
June 3					41	@		218
June 20					62	@		225
August 15					19	@		212
September 20					20	@		211
November 7	16	@		192

 

In inventory at December 31, 2013, were 8 blowers and 29 mowers. Assume the company uses a periodic inventory system.

 

Required 1:

 

(a)	Compute ending inventory valuation at December 31, 2013 under the FIFO and LIFO cost-flow assumptions. (Hint: Compute ending inventory under each method, and then compare results.)

The following data are available for Sellco for the fiscal year ended on January 31, 2014:

Problem 2

Sales	840	units
Beginning inventory	280	units	@	$	4
Purchases, in chronological order	300	units	@	$	5
	420	units	@	$	7
	240	units	@	$	8

 

Required:

 

(a)	Calculate cost of goods sold and ending inventory amounts under the cost-flow assumptions, FIFO, LIFO and Weighted average (using a periodic inventory system): (Round your unit cost to 2 decimal places.)

 

(b)	Assume that net income using the weighted-average cost-flow assumption is $14,400.Calculate net income under FIFO and LIFO. (Round your unit cost to 2 decimal places.)