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Calculate inventory cost using FIFO, LIFO, average cost

Problem 1.

Jan 1 Inventory 27 units at $120
Feb 17 Purchase 54 units at $138
July 21 Purchase 63 units at $156
Nov 23 Purchase 36 unit at $165

50 units of the item in the physical inventory at Dec 31. The periodic inventory system should be used to determine the inventory cost by:
1. The first in, first out
2. last in, first out method, and
3 .the average cost method.

Problem 2.

Jan 1 Inventory 42 units at $60
Mar 10 Purchase 58 units at $65
Aug 30 Purchase 20 units at $68
Dec 12 Purchase 30 units at $70

There are 36 units of the item in the physical inventory at Dec 31. The periodic inventory system is used. Determine the inventory cost and the cost of merchandise sold by three methods, presenting your answers in the following form:

Merch inventory Merch Sold
a. first in, first out $ $
b. last in, first out $ $
c. Average cost $ $

Solution Summary

Your tutorial is attached in Excel and shows you how to compute ending inventory for LIFO, FIFO and average cost methods. On the second problem, the cost of goods sold is also computed for you.

$2.19