InventoryProblem2Solution.xls - ALEX - Alabama Learning Exchange

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					                                                                              B-08.05


Tom Pryor is conducting an audit of the inventory system used by Zix Corporation. Tom
has inserted hypothetical data into the computer program that tracks inventory on a
perpetual basis. Below are the hypotheical data inserted by Tom:


                   Transaction         Units       Cost per unit
                Beginning inventory     10             $10
                 Purchase, day 1        5              $11
                   Sale, day 2          6
                 Purchase, day 3        8               $12
                   Sale, day 4          9

Solve the problem for FIFO, LIFO, and Weighted Cost methods if 8 units are on hand at
the end of the period. Consider both sales and purchases (perpetual) as you calculate.




FIFO Answer
 $      96

LIFO Answer
 $      80

Weighted Cost
$       87
Name:
                                                              B-08.05
Date:               Section:


FIFO PERPETUAL:
        Date       Purchases      Cost of Goods Sold    Balance
        Day 0                                          10 X $10 = $100
        Day 1
                  5 X $11 = $55


        Day 2



        Day 3

                  8 X $12 = $96


        Day 4



        Ending

LIFO PERPETUAL:
        Date       Purchases      Cost of Goods Sold    Balance
        Day 0                                          10 X $10 = $100
        Day 1
                  5 X $11 = $55


        Day 2



        Day 3
                  8 X $12 = $96


        Day 4



        Ending



                                                                     2 of 3
Name:
                                                              B-08.05
Date:               Section:


Moving Average:
        Date       Purchases      Cost of Goods Sold    Balance
        Day 0                                          10 X $10 = $100
        Day 1
                  5 X $11 = $55


        Day 2
        Day 3
                  8 X $12 = $96


        Day 4
        Ending




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