Explore BrainMass

Explore BrainMass

    FIFO, LIFO and Average Cost

    Not what you're looking for? Search our solutions OR ask your own Custom question.

    This content was COPIED from BrainMass.com - View the original, and get the already-completed solution here!

    On March 31st, the Maple Shop had no alarm clocks on hand. During the next four months, it first purchased 50 clocks for $14 each, and then 75 more for $12 each. During these four months, 100 alarm clocks were sold.

    What will the July 31 alarm clock inventory amount and the four months' cost of goods be if the Maple Shop uses the periodic inventory method and...

    (a) average cost
    (b) FIFO
    (c) LIFO

    © BrainMass Inc. brainmass.com March 4, 2021, 7:46 pm ad1c9bdddf

    Solution Preview

    (a) Average cost

    Under average cost method, we find the average cost of units which have been purchased. In this question, 50 clocks were purchased for $14, total amount is 700. 75 were purchased for $12, total amount is 900. The total number of clocks purchased is 125 ...

    Solution Summary

    The solution explains the inventory calculations using FIFO, LIFO and Average Cost methods. This is all completed in about 186 words.