1 Cost of goods available for sale

2 Calculation fo Ending inventory under FIFO

Calculation of cost ofsales under FIFO
Proof of Cost of sales under FIFO
Calculation of Ending inventory under LIFO
Calculation of cost ofsales under LIFO
Proof of Cost of sales under LIFO
Calculation of Ending inventory under average
Calculation of Cost of sales under average
Proof for Cost of Sales under Average

Inventory recording method (FIFO, LIFO, Average)

Zoom Around Town Ltd (Exercise PSA5.3)
1 Cost of goods available for sale
Date Details Units Unit Price $ Total cost $
1-Mar Beginning Inventory 90 70 $ 6,300.00
5-Mar Purchase 210 80 $ 16,800.00
13-Mar Purchase 330 90 $ 29,700.00
21-Mar Purchase 240 100 $ 24,000.00
26-Mar Purchase 90 110 $ 9,900.00
Total 960 $ 86,700.00

2 Calculation fo Ending inventory under FIFO need to make a sale of 810 Units - "FIFO
Date Details Units Unit Price $ Total cost $
1-Mar Beginning Inventory - Sold 90 70 $ 6,300.00
5-Mar Sold 210 80 $ 16,800.00
13-Mar Sold 330 90 $ 29,700.00
21-Mar Sold (810-630) 180 100 $ 18,000.00 (90+210+330=630 , 810-6
22-Mar Left Inventory (240-180) 60 100 $ 6,000.00
26-Mar Left Inventory 90 110 $ 9,900.00
Therefore Total Left EOM 150 $ 15,900.00
3 Calculation of cost ofsales under FIFO
Cost good available for sale $ 86,700.00
less: Ending Inventory (FIFO) $ 15,900.00
Cost of Sales (FIFO) $ 70,800.00

4 Proof of Cost of sales under FIFO

Date Details Units Unit Price $ Total cost $
1-Mar Beginning Inventory 90 70 $ 6,300.00
5-Mar Purchase 210 80 $ 16,800.00
13-Mar Purchase 330 90 $ 29,700.00
21-Mar Purchase (810-630) 180 100 $ 18,000.00
$ 70,800.00
 5 Calculation of Ending inventory under LIFO need to make a sale of 810 Units - "LIFO
Date Details Units Unit Price $ Total cost $
26-Mar Sold 90 110 $ 9,900.00
21-Mar Sold 240 100 $ 24,000.00
13-Mar Sold 330 90 $ 29,700.00
5-Mar Sold (810 -660) 150 80 $ 12,000.00
5-Mar Left Inventory (210-150) 60 80 $ 4,800.00
1-Mar Left Inventory 90 70 $ 6,300.00
Therefore Total Left EOM 150 $ 11,100.00
6 Calculation of cost ofsales under LIFO
Cost good available for sale $ 86,700.00
less: Ending Inventory (LIFO) $ 11,100.00
Cost of Sales (LIFO) $ 75,600.00

7 Proof of Cost of sales under LIFO

Date Details Units Unit Price $ Total cost $
26-Mar Beginning Inventory 90 110 $ 9,900.00
21-Mar Purchase 240 100 $ 24,000.00
13-Mar Purchase 330 90 $ 29,700.00
5-Mar Purchase (810 -660) 150 80 $ 12,000.00
$ 75,600.00
8 Calculation of Ending inventory under average
86700/960 $ 90.3125
Date Details Units Unit Price $ Total cost $
26-Mar Ending inventory (960 - 810) 150 90.3125 $ 13,546.88

9 Calculation of Cost of sales under average

Cost: goods available for sale $ 86,700.00
Less: Ending Inventory $ 13,546.88
Cost of Sales under Average $ 73,153.13

10 Proof for Cost of Sales under Average

Units sold * average Prive 810*90.3125 $ 73,153.13 Ramit Kumar:
Create a summary of what
above.
Summary Table FIFO LIFO Average
Ending Inventory 15,900.00 11,100.00 13,546.88
Cost of Sales 70,800.00 75,600.00 73,153.18
Ramit Kumar:
Analysis of the results in question (c): Now need to make a decisio
highest Inventory Amount FIFO summary table.

Highest cost of sales LIFO

 1 Cost of goods available for sale

Date
1-Dec
9-Dec
15-Dec

e a sale of 810 Units - "FIFO" 2 Calculation fo Ending inventory under FIFO

Date

FIFO (Total units for sale = 13=6 = 19)

Date
(90+210+330=630 , 810-630 =180) 1-Dec
9-Dec
e a sale of 810 Units - "LIFO"

Ramit Kumar:
Create a summary of what has been done
above.

Ramit Kumar:
Now need to make a decision from the
summary table.
Cost of goods available for sale

Details Units Unit Price $ Total cost $

Beginning Inventory 11 10 110
Purchase 14 15 210
Purchase 10 17 170
Total 35 490

Calculation fo Ending inventory under FIFO need to make a sale of 810 Units - "FIFO"
Details Units Unit Price $ Total cost $

FIFO (Total units for sale = 13=6 = 19)

Details Unit Unit price Total cost
Beginning inventory 11 10 110
Sales 8 15 120
Cost of goods sold 19 230
current ratio = current asset/ current liabilities 172,000/133,000 = 1.29

acid test ration = current asset – inventories/current liabilities = 172,000-77000 / 133,0

Inventory turnover = Cost of sales / average Inventory  315,000/73000 = 4.3150 times

days in inventory = no. of days in year (365)/inventory turnover 365/4.3150 = 84.59  8

day's sale in account receivable = (Average receivable/ credit sales) x 365 63500/462,0

Profit margin : (Gross profit/ sales) x 100 = 147000-315,000x100 = 4.66 % Gross profit 
Units - "FIFO"
133,000 = 1.29

ilities = 172,000-77000 / 133,000 = 0.71

315,000/73000 = 4.3150 times

rnover 365/4.3150 = 84.59  85 Days

edit sales) x 365 63500/462,000 x 365 = 50 days

00x100 = 4.66 % Gross profit  sales - cost of goods sold = 462,000-315,000= 147000