Asked by Eribel Almonte on Jul 29, 2024
Verified
The units of an item available for sale during the year were as follows: There are 50 units of the item in the physical inventory at December 31. The periodic inventory system is used. Determine the ending inventory cost by (a) the first-in, first-out method, (b) the last-in, first-out method, and (c) the average cost method. Show your work.
Periodic Inventory System
An inventory accounting system where updates to inventory levels are made on a periodic basis, rather than being updated continuously.
First-In, First-Out
An inventory valuation method where the goods first purchased or produced are also the first to be sold, impacting the cost of goods sold and inventory value.
Average Cost
A calculation used in finance and economics that divides the total cost of production by the number of goods produced, yielding the cost per unit.
- Estimate the cost of goods sold, gross profit, and final stock level following varied cost flow methods.
Verified Answer
Learning Objectives
- Estimate the cost of goods sold, gross profit, and final stock level following varied cost flow methods.
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