Imagine that you're the manager of the Candle Shop. Figures C-1 contains your records of annual inventory figures for candles. Using the FIFO method of inventory pricing, what is the dollar value of ending inventory if there were 17,000 units on hand on December 31? Show all your work.
We don't have figure C-1.
figure c-1 is
Jan.1 beginning invenntory- 5,000 units @.89
feb.15 purchase- 10,000 units @.69
apr.15 purchase- 2,000 units @1.09
jul 15 purchase- 4,000 units @.99
oct.15 purchase- 1,000 units @1.19
dec.15 purchase- 2,000 units @1.09
15030
To calculate the dollar value of ending inventory using the FIFO (First-In, First-Out) method, you need to analyze the inventory records and find the cost of the oldest units first. Here's how you can determine the dollar value of ending inventory:
1. Look at the inventory records in Figure C-1 provided to find the relevant information. Usually, you would have columns like "Date of Purchase", "Quantity Purchased", and "Cost per Unit" in your inventory records.
2. Identify the cost per unit for the oldest inventory items first. This means considering the candle units that were purchased first.
3. Calculate the cost of the oldest units by multiplying the quantity of those units by their respective cost per unit.
4. Subtract the sold units from the total inventory units to determine the number of remaining units.
5. Repeat steps 2-4 for subsequent purchases until all the units are accounted for or you reach the desired number of units (in this case, 17,000 units).
6. Finally, sum up the costs of all the units that remain in inventory after following the FIFO method.
By following these steps, you should be able to determine the dollar value of ending inventory using the FIFO method based on the provided inventory records.