please check my answer thanks :)
I messed up somewhere.:(
Using the FIFO method of inventory pricing, what is the dollaor value of ending inventory if there were 17,000 units on hand on Dec 31 Must show all of work
Jan 1 5,ooo @ $0.89 = 4450
Feb 15 10,000 @$ 0.69 = 6900
Apr 15 2,000 @$1.09 = 2180
July 15 4,000 @$0.99 = 3960
Oct 15 1,000 @$1.19 = 1190
Dec 15 2,000 @ $1.09 = 2180
+------------
20860
I keep messing up could someone please tell me what I am doing wrong thanks in advance :)
You only have 17,000 left in the store. The early months are gone - sold.
So start at Dec and work back until you get to 17,000
Dec 2,000 @ 1.09 = 2180
Oct 1,000 @ 1.19 = 1190
July 4,000@ 0.99 = 3960
April 2000@ 1.09 = 2180 that is 9000 units
Feb- 8,000@ 0.69 = 5520 that is 17000 units, the end
To calculate the dollar value of the ending inventory using the FIFO (First-In, First-Out) method, you need to determine the cost of the units that were still on hand on Dec 31. FIFO assumes that the units that were purchased or produced first are the ones sold first. So, to calculate the ending inventory, you need to start with the units purchased or produced last and work your way backwards.
Let's go step by step to calculate the ending inventory value:
1. Jan 1: 5,000 units @ $0.89 each = $4,450
2. Feb 15: 10,000 units @ $0.69 each = $6,900
3. Apr 15: 2,000 units @ $1.09 each = $2,180
4. July 15: 4,000 units @ $0.99 each = $3,960
5. Oct 15: 1,000 units @ $1.19 each = $1,190
6. Dec 15: 2,000 units @ $1.09 each = $2,180
To determine the value of the ending inventory, you need to add up the total cost of the units on hand. So, add up the costs from steps 1 to 6:
$4,450 + $6,900 + $2,180 + $3,960 + $1,190 + $2,180 = $20,860
After calculating, the dollar value of the ending inventory is $20,860.
Based on the calculations you provided, it seems like you made an addition error while adding up the costs of the units. Double-check your calculations to ensure accurate totals.
Let me know if you need further assistance or clarification!