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Intermediate Accounting 2 - LIFO, FIFO and perpetual system

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Ferris company began 2009 with 6000 units of its principal product. The cost of each unit is $8.

Merchandise transactions for the month of January 2009 are as follows:

Date of Purchase Units Unit Cost Total Cost

10-Jan 5000 $9 45000
18-Jan 6000 10 60000
11000 $19 105000
*includes purchase price and cost of freight

8000 units were on hand at the end of each month.


Calculate January's ending inventory and cost of goods sold for the month using each of the following alternatives:

1. FIFO, Periodic System
2. LIFO, Periodic System
3. LiFO, Perpetual System

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Solution Summary

The solution computes cost of inventory under LIFO, FIFO and perpetual system for Ferris company.

Solution Preview

1 - Ending Inventory = 6000*10 + 2000*9 = 78,000
Cost of Goods Sold = ...

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