Alternative Inventory Methods Totman Company has the following transactions during the months of January and February Date Transaction Units Cost Unit January 1 Balance 200 10 Purchase 50 $25 22 Sale 40 28 Purchase 60 27 February 4 Purchase 40 28 14 Sale 50 23 Sale 20 The cost of the inventory at January 1 is $24, $23, and $15 per unit, respectively, under the FIFO, average, and LIFO cost flow assumptions Required Compute the cost of goods sold for each month and the inventories at the end of each month for the following alternatives FIFO periodic Cost of Goods Sold Ending Inventory January $ $ February $ $ FIFO perpetual Cost of Goods Sold Ending Inventory January $ $ February $ $ LIFO periodic Cost of Goods Sold Ending Inventory January $ $ February $ $ LIFO perpetual Cost of Goods Sold Ending Inventory January $ $ February $ $ Weighted average (Round unit costs to 4 decimal places and round final answers to nearest dollar ) Cost of Goods Sold Ending Inventory January $ $ February $ $ Moving average (Round unit costs to 4 decimal places Round final answers to nearest dollar ) Cost of Goods Sold Ending Inventory January $ $ February $ $ Reconcile the difference between the LIFO periodic and the LIFO perpetual results January Cost of Goods Sold Ending Inventory Difference $ $ February Cost of Goods Sold Ending Inventory Difference $ $ If the company had purchased an additional 25 units for $30 each on February 27, compute the cost of goods sold for February under FIFO periodic and LIFO periodic February FIFO periodic LIFO periodic Cost of Goods Sold $ $ When computing inventory turnover ratios, it's preferable to use a measure because it avoids distortions caused by including costs in inventory Use of the preferable method results in a inventory turnover

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Alternative Inventory Methods Totman Company has the following transactions during the months of January and February: Date Transaction Units Cost/Unit January 1 Balance 200 10

Alternative Inventory Methods

Totman Company has the following transactions during the months of January and February:

Date Transaction Units Cost/Unit

January 1 Balance 200

10 Purchase 50 $25

22 Sale 40

28 Purchase 60 27

February 4 Purchase 40 28

14 Sale 50

23 Sale 20

The cost of the inventory at January 1 is $24, $23, and $15 per unit, respectively, under the FIFO, average, and LIFO cost flow assumptions.

Required:
1. Compute the cost of goods sold for each month and the inventories at the end of each month for the following alternatives:
  1. FIFO periodic
    
    Cost of Goods Sold Ending Inventory
    
    January $ $
    
    February $ $
  2. FIFO perpetual
    
    Cost of Goods Sold Ending Inventory
    
    January $ $
    
    February $ $
  3. LIFO periodic
    
    Cost of Goods Sold Ending Inventory
    
    January $ $
    
    February $ $
  4. LIFO perpetual
    
    Cost of Goods Sold Ending Inventory
    
    January $ $
    
    February $ $
  5. Weighted average (Round unit costs to 4 decimal places and round final answers to nearest dollar.)
    
    Cost of Goods Sold Ending Inventory
    
    January $ $
    
    February $ $
  6. Moving average (Round unit costs to 4 decimal places. Round final answers to nearest dollar.)
    
    Cost of Goods Sold Ending Inventory
    
    January $ $
    
    February $ $
2. Reconcile the difference between the LIFO periodic and the LIFO perpetual results.
  
  January Cost of Goods Sold Ending Inventory
  
  Difference $ $
  
  February Cost of Goods Sold Ending Inventory
  
  Difference $ $
3. If the company had purchased an additional 25 units for $30 each on February 27, compute the cost of goods sold for February under FIFO periodic and LIFO periodic.
  
  February FIFO periodic: LIFO periodic:
  
  Cost of Goods Sold: $ $
4. When computing inventory turnover ratios, it's preferable to use a measure because it avoids distortions caused by including costs in inventory. Use of the preferable method results in a inventory turnover.