Part $2-$ Cost Flow Assumptions

Barlow Corp. has the following inventory balances and transactions during September and uses the Perpetual

Inventory System. Show all calculations performed.

Calculate the Cost of Goods Sold and Ending Inventory for September using the First$-$in$-$First$-$Out $($FIFO$)$ Method.

COGS:

$30$ units $$$$\frac{14}{u}$nit $=$$$420$

$50$ units $$$$\frac{25}{u}$nit $=$$$1,250$

$20$ units $$$$\frac{30}{u}$nit $=$$$600$

$420+1,250+600=$

Total COGS $=$$$2,270$

Ending Inventory:

$10$ units $$$$\frac{30}{u}$nit $=$$$300$

$40$ units $$$$\frac{60}{u}$nit $=$$$2,400$

$300+2,400=$

Total Ending Inventory $=$$$2,700$

Calculate the Cost of Goods Sold and Ending Inventory for September using the Last$-$in$-$First$-$Out $($LIFO$)$ Method.

COGS:

$30$ units $$$$\frac{30}{u}$nit $=$$$900$

$50$ units $$$$\frac{25}{u}$nit $=$$$1,250$

$20$ units $$$$\frac{14}{u}$nit $=$$$280$

$900+1,250+280=$

Total COGS $=$$$2,430$

Ending Inventory:

$10$ units $$$$\frac{14}{u}$nit $=$$$140$

$40$ units $$$$\frac{60}{u}$nit $=$$$2,400$

$140+2,400=$

Total Ending Inventory $=$$$2,540$

Calculate the Cost of Goods Sold and Ending Inventory for September using the Weighted Average Cost Method.

Round calculations to $2$ decimal places.

Total Ending Inventory:

$10$ units $$$$\frac{23\mathrm{.}36}{u}$nit $=$$$233\mathrm{.}60$

$40$ units $$$$\frac{60}{u}$nit $=$$$2,400$

$233\mathrm{.}60+2,400=$

Total Ending Inventory $=$$$2,633\mathrm{.}60$

Record the sales journal entry on $\frac{10}{20}$ for each method.

Assume that it was a sale on account with no discount terms.

FIFO Method

LIFO Method

Average Cost Method