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March 29, 2017

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I have 2 questions involving inventory

Question 1.
Your a manager of an auto parts store.Figures below contains your records of the annual inventory figures for windshield wipers. Using the FIFO method of inventory pricing,hat is the dollor value of ending inventory if there were 300 units on hand on Dec.31? Round yur aswer to the nearest dollor.
Answers to choose from
A.3,188
B.3,219
c.3,350
d.3,600

January 1 Beginning inventory 300 units @11.00
March 15 Purchase 150 units @ 10.50
June 10 Purchase 200 units @ 10.75
Sept.22 Purchase 175 units @ 10.00
Dec.10 Purchase 100 units @ 12.00

Then the second question wants the dollor value of the ending inventory using the LIFO method,having the ending inventory on Dec 31 of 500 units.
Answers
A.5,450
b.5,413
c.5,363
d.5,225
Could you please help.thank-you

  • Math - ,

    FIFO-first in, first out
    300 @ 11.00
    150 @ 10.50
    200 @ 10.75
    175 @ 10.00
    100 @ 12.00
    Beginning Inventory Total = 925
    Ending Total = 300
    Difference = sold = 625

    FIFO-first in, first out
    Items sold are assumed to be subtracted from the first ones purchased. Go down from the top and subtract from each purchase until you reach the number sold of 625.

    300 @ 11.00--sold 300, 0 left
    150 @ 10.50--sold 150, 0 left
    200 @ 10.75--sold 175, 25 left
    175 @ 10.00--sold 0, 175 left
    100 @ 12.00--sold 0, 100 left

    Calculate value of inventory remaining
    25 @ 10.75 = $268.75
    175 @ 10.00 = $1750.00
    100 @ 12.00 = $1200.00
    Total 300 units

    268.75 + 1750.00 + 1200.00 = 3218.75

    Value of 300 units on hand on Dec.31 = $3219.

    Now, you do LIFO-last in, first out
    Do the same as I did, except start subtracting from the last purchased until you reach the total sold (bottom to top).

  • Math - ,

    Thank-you for your help,my computer went down yesterday after I put my question in.

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