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  • Homework Chapter 6

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    Nguyet Tran Thi Thu
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    This document provides an example of calculating inventory costs using the FIFO and LIFO methods. Under FIFO, the oldest inventory units (with the lowest costs) are sold first, leaving the most recently purchased units in ending inventory. Under LIFO, the most recently purchased units are sold first, leaving the oldest (lowest cost) units in ending inventory. The total ending inventory value and cost of goods sold is the same under both methods, though the individual values differ.

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    HOMEWORK CHAPTER 6

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    This document provides an example of calculating inventory costs using the FIFO and LIFO methods. Under FIFO, the oldest inventory units (with the lowest costs) are sold first, leaving the most recently purchased units in ending inventory. Under LIFO, the most recently purchased units are sold first, leaving the oldest (lowest cost) units in ending inventory. The total ending inventory value and cost of goods sold is the same under both methods, though the individual values differ.

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    © All Rights Reserved
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    5 views1 page

    Homework Chapter 6

    Uploaded by

    Nguyet Tran Thi Thu
    This document provides an example of calculating inventory costs using the FIFO and LIFO methods. Under FIFO, the oldest inventory units (with the lowest costs) are sold first, leaving the most recently purchased units in ending inventory. Under LIFO, the most recently purchased units are sold first, leaving the oldest (lowest cost) units in ending inventory. The total ending inventory value and cost of goods sold is the same under both methods, though the individual values differ.

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    HOMEWORK CHAPTER 6:

    6.4: a,

    FIFO Method
    Available for sale Cost Of Goods Sold Ending Inventory
    Date Units Unit Unit Unit COGS Unit Unit cost Ending
    cost sold cost in EI Inventory
    value

    Beginning Inventory 26 $97 26 $97 $97


    Purchase- Sep 12 45 $102 45 $102 $102
    Purchase- Sep 19 20 $104 20 $104 $104
    Purchase- Sep 26 50 $105 30 $105 20 $105 $2,100
    Total 141 121 20

    LIFFO Method
    Available for sale Cost Of Goods Sold Ending Inventory
    Date Units Unit Unit Unit COGS Unit Unit cost Ending
    cost sold cost in EI Inventory
    value

    Beginning Inventory 26 $97 6


    Purchase- Sep 12 45 $102 45
    Purchase- Sep 19 20 $104 20
    Purchase- Sep 26 50 $105 50
    Total 141 121

    b,
    FIFO method: $12,324 + $2,100 = $14,442
    LIFO method: $12,502 + $1,940 = $14,442
     The sum EI and COGS is the same for both method

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