Trader sells 15 units for $25 each on December 15. Eight of the sold units are from the December 7

purchase and seven are from the December 14 purchase. Trader uses a perpetual inventory system.
Determine the costs assigned to the December 31 ending inventory when costs are assigned based on
(a) FIFO, (b) LIFO, (c) weighted average, and (d ) specific identification.

To determine the costs assigned to the December 31 ending inventory using different cost flow assumptions, let's calculate the costs assigned based on (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification.

Given information:
- Units sold on December 15: 15 units
- December 7 purchase: 8 units
- December 14 purchase: 7 units

(a) FIFO (First-In, First-Out):
Under the FIFO method, the first units purchased are assumed to be the first ones sold.

Step 1: Determine the cost of units sold on December 15
Since the first units purchased were on December 7, we will use their cost.
Cost of units sold (December 7 purchase): 8 units * Cost per unit

Step 2: Determine the cost of the ending inventory at December 31
Since the remaining units after the sale are from the December 14 purchase, we will use their cost.
Cost of ending inventory (December 14 purchase): (7 units - units sold) * Cost per unit

(b) LIFO (Last-In, First-Out):
Under the LIFO method, the most recent units purchased are assumed to be the first ones sold.

Step 1: Determine the cost of units sold on December 15
Since the most recent units purchased were on December 14, we will use their cost.
Cost of units sold (December 14 purchase): 7 units * Cost per unit

Step 2: Determine the cost of the ending inventory at December 31
Since the remaining units after the sale are from the December 7 purchase, we will use their cost.
Cost of ending inventory (December 7 purchase): (8 units - units sold) * Cost per unit

(c) Weighted Average:
Under the weighted average method, the average cost per unit is used to allocate the cost.

Step 1: Calculate the weighted average cost per unit
Total cost of units purchased = (Cost per unit * units purchased on December 7) + (Cost per unit * units purchased on December 14)
Total units purchased = units purchased on December 7 + units purchased on December 14
Weighted average cost per unit = Total cost of units purchased / Total units purchased

Step 2: Determine the cost of units sold on December 15
Cost of units sold: units sold * Weighted average cost per unit

Step 3: Determine the cost of the ending inventory at December 31
Cost of ending inventory: (Total units purchased - units sold) * Weighted average cost per unit

(d) Specific Identification:
Under the specific identification method, the cost of each individual unit sold is identified and used.

Step 1: Determine the cost of units sold on December 15
Since it is specified that eight of the sold units are from the December 7 purchase and seven are from the December 14 purchase, we will use their respective costs.
Cost of units sold: (8 units from December 7 purchase * Cost per unit) + (7 units from December 14 purchase * Cost per unit)

Step 2: Determine the cost of the ending inventory at December 31
We do not have enough information to determine the exact cost of the ending inventory under the specific identification method without additional details.

Please note that we need the cost per unit for each purchase to complete the calculations.

To determine the costs assigned to the December 31 ending inventory under different costing methods, we need to analyze the purchases and calculate the cost per unit for each method.

Given information:
- 15 units were sold on December 15.
- 8 units were from the December 7 purchase.
- 7 units were from the December 14 purchase.
- Trader uses a perpetual inventory system, which means the cost of inventory is continuously updated.

(a) FIFO (First-In, First-Out):
Under FIFO, the cost of the first units purchased is allocated to the cost of goods sold (COGS), and the remaining units are assigned to the ending inventory. In this case, the 8 units from the December 7 purchase are considered the first units.

Cost of goods sold (COGS) calculation:
8 units * cost per unit from December 7 purchase

Ending inventory calculation:
7 units * cost per unit from December 14 purchase

(b) LIFO (Last-In, First-Out):
Under LIFO, the cost of the most recent units purchased is allocated to the cost of goods sold (COGS), and the older units are assigned to the ending inventory. In this case, the 7 units from the December 14 purchase are considered the most recent units.

Cost of goods sold (COGS) calculation:
7 units * cost per unit from December 14 purchase

Ending inventory calculation:
8 units * cost per unit from December 7 purchase

(c) Weighted Average:
Under the weighted average method, the cost per unit is calculated by dividing the total cost of all units available for sale by the total number of units.

Total cost of units available for sale = (number of units from December 7 purchase * cost per unit from December 7 purchase) + (number of units from December 14 purchase * cost per unit from December 14 purchase)

Cost per unit = Total cost of units available for sale / Total number of units available for sale

Cost of goods sold (COGS) calculation:
15 units * cost per unit

Ending inventory calculation:
No specific calculation needed for weighted average, as the cost per unit is already determined.

(d) Specific Identification:
Under the specific identification method, each unit sold is matched with its actual cost. So, in this case, we need to know the specific cost of each unit sold.

Cost of goods sold (COGS) calculation:
(Cost per unit from December 7 purchase * number of units from the December 7 purchase) + (Cost per unit from December 14 purchase * number of units from the December 14 purchase)

Ending inventory calculation:
No specific calculation needed for specific identification, as the cost per unit is already determined for each unit.

Now, depending on the information provided about the cost per unit for each purchase, you can apply the calculations described above to determine the costs assigned to the December 31 ending inventory under the four different costing methods: FIFO, LIFO, weighted average, and specific identification.