Question:
Ledger Accounts for Materials Cost Flow. The Littner Company produces a product from one basic raw material. During one week of operations, the materials ledger card reflected the following transactions:
1st weekday
2d "
3d
4th
5th
6th
Beginning balance: 1,400 pounds @ $4.60 per lb. Received 1,000 pounds @ $4.80 per lb.
Issued 800 pounds. Issued 800 pounds.
Received 1,200 pounds @ $5.00 per lb.
Issued 800 pounds.
Other costs for the week were direct labor, $4,800, and factory overhead, $4,360; 1,700 units of product were completed, and 1,500 were sold. There was no beginning inventory of finished goods, and no work is left in process over the weekend.
Required:
(1) Ledger accounts for Materials, Work in Process, Finished Goods, and Cost of Goods Sold, using (a) fifo costing and (b) lifo costing. As- sume a perpetual inventory system is used.
(2) The final inventory by the lifo costing method if inventory is taken at the end of the week and if day-to-day receipts and issues are ignored.