My Questions: Please explain to me where the numbers for ending inventory came from in special identification such as the 250, 750, 1500 and 7500.

Where did the 3500 come from in FIFO cost of goods sold?

Where did the 2500 come from in ending inventory for FIFO?

Where did the 8,500 come from in Weighted Average?

Where did the 10,000 come from in Weighted Average for ending inventory?

Where did 1000 X 5.15 come from in LIFO?

Where did the numbers come from in ending inventory for LIFO?

Exercise 1:

You work for BDB Corporation. The CFO wants your help analyzing the various inventory cost flow assumptions. We will use the same data set to explore Specific Identification, FIFO, Average Cost, and LIFO.

Date	Per Unit Cost to Purchase	Inventory Purchases (units)	Sales (units)
3/1/2022	$ 4.85	1,000	4850
3/12/2022	$ 5.00	4,000	20,000
3/14/2022			4,500
3/15/2022	$ 5.15	6,000	30,900
3/19/2022			4,000
3/30/2022	$ 5.20	7,500	39,000

Calculate the cost of goods sold and ending inventory for each cost flow assumption.

Specific Identification:

Assume that the company specifically identified of the total units sold (4,500 units on March 14 and 4,000 units on March 19) 750 units were from the beginning inventory (March 1), 3,250 units were from the March 12 purchase, and 4,500 units were from the March 15 purchase. Calculate cost of goods sold and ending inventory.

Cost of Goods Sold: $4362.50

(750 X 4.85) + (3,250 X5)+ (4500 X 5.15)= 4362.50

(4 X 250=1000)

Ending Inventory: $51,687.50

(250 X $4.85) + (750 X $5) + (1,500 X $5.15) + (7500 X $5.20)= 51,687.50

First-in, First-Out (FIFO):

Cost of Goods Sold: (1,000 X $4.85) + (4,000 X $5) + (3,500 X $5.15) = $42,875

Ending Inventory:

(0 X $4.85) + (0 X $5) + (2,500 X $5.15)+ (7,500 X $5.2)

= $51,875

Weighted Average (round your calculation four decimal places):

Cost of Goods Sold: (1000 X $4.85) + (4000 X $5) + (6000 X $5.15) + (7,500 X $5.20)

=

$94,750 / (1000 + 4000 +6000 +7500)

$94,750/18500 units

=$5.1216

$5.1216 X 8,500= $43,533.78

Ending Inventory: $5.1216 * 10,000= $51,216.22

Last-in, First-Out (LIFO):

Cost of Goods Sold: (7,500 X $5.20) + (1000 X $5.15) = $44,150

Ending Inventory: (1,000 X $4.85) + (4000 X $5) + (5,000 X $5.15) + (0* $5.20)= $50,600