Mitchell Companys record of transactions for the month of June was as follows.

Purchases: Date Units Unit Cost June 1 600 @ 3.00 4 1,500 @ 3.04 8 800 @ 3.20 13 1,200 @ 3.25 21 700 @ 3.30 29 500 @ 3.13 ------- 5,300

Sales: Date Units Unit Cost June 3 500 @ 5.00 9 1,300 @ 5.00 11 600 @ 5.50 23 1,200 @ 5.50 27 900 @ 6.00 ---------- 4,500

Instructions

(a) Assuming that periodic inventory records are kept, compute the cost of goods sold and ending inventory at June 30 using (1) FIFO and (2) average cost.

Explain your answer

a) Periodic Inventory system

FIFO:

Cost of goods sold // Ending Inventory

Average cost:

Cost of Goods sold // Ending inventory

(b) Assuming that perpetual inventory records are kept in both units and dollars, determine the Cost of goods sold and ending inventory at June 30 using (1) FIFO and (2) moving average cost.

Explain your answer

b) Perpetual Inventory system

FIFO method:

Cost of goods sold // Ending Inventory

Average cost:

Cost of goods sold // Ending inventory