Asked by Savannah Young Kelsey on Apr 24, 2024
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Ford Co. uses a periodic inventory system. Its records show the following for the month of May in which 75 units were sold. Units‾ Unit Cost ‾ Total Cost ‾ May1 Inventory 35$8$28015 Purchases 301236024 Purchases 40‾13520‾ Totals 105‾$1.160‾\begin{array}{llccc}&& \underline{\text { Units}}& \underline{\text { Unit Cost }}& \underline{\text { Total Cost }}\\\text { May}& 1 \text { Inventory } & 35 & \$ 8&\$280 \\&15 \text { Purchases } & 30 & 12&360 \\&24 \text { Purchases } & \underline{40} & 13 & \underline{520}\\&\text { Totals }& \underline{105}&& \underline{\$1.160}\end{array} May1 Inventory 15 Purchases 24 Purchases Totals Units353040105 Unit Cost $81213 Total Cost $280360520$1.160 Instructions
Compute the ending inventory at May 31 and cost of goods sold using the FIFO and LIFO methods. Prove the amount allocated to cost of goods sold under each method.
FIFO
"First In, First Out," an inventory valuation method that assumes the first items placed in inventory are the first sold.
LIFO
Last In, First Out, an inventory valuation method where the latest items added to inventory are the first to be sold.
Cost of Goods Sold
Cost of Goods Sold (COGS) refers to the direct costs attributable to the production of the goods sold in a company.
- Figure out the concluding inventory value and the expenditure of goods sold utilizing numerous inventory costing methods.
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Learning Objectives
- Figure out the concluding inventory value and the expenditure of goods sold utilizing numerous inventory costing methods.
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