Perpetual Inventory Using FIFO

The following units of a particular item were available for sale during the calendar year:

Jan. 1	Inventory	3,800 units at $40
Apr. 19	Sale	2,600 units
June 30	Purchase	4,700 units at $43
Sept. 2	Sale	5,000 units
Nov. 15	Purchase	1,900 units at $48

The firm maintains a perpetual inventory system. Determine the cost of goods sold for each sale and the inventory balance after each sale, assuming the first-in, first-out method. Present the data in the form illustrated in Exhibit 3. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column.

Schedule of Cost of Goods Sold FIFO Method
	Purchases			Cost of Goods Sold			Inventory
Date	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost
Jan. 1								$	$
Apr. 19					$	$
June 30		$	$
Sept. 2
Nov. 15
Dec. 31	Balances					$			$

Perpetual Inventory Using LIFO

The following units of a particular item were available for sale during the calendar year:

Jan. 1	Inventory	3,800 units at $39
Apr. 19	Sale	2,500 units
June 30	Purchase	4,600 units at $45
Sept. 2	Sale	5,200 units
Nov. 15	Purchase	2,000 units at $47

The firm maintains a perpetual inventory system. Determine the cost of goods sold for each sale and the inventory balance after each sale, assuming the last-in, first-out method. Present the data in the form illustrated in Exhibit 4. Under LIFO, if units are in inventory at two or more different costs, enter the units with the LOWER unit cost first in the Inventory Unit Cost column.

Schedule of Cost of Goods Sold LIFO Method
	Purchases			Cost of Goods Sold			Inventory
Date	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost
Jan. 1								$	$
Apr. 19					$	$
June 30		$	$
Sept. 2
Nov. 15
Dec. 31	Balances					$			$

Weighted Average Cost Method with Perpetual Inventory

The beginning inventory for Midnight Supplies and data on purchases and sales for a three-month period are as follows:

Date		Transaction	Number of Units		Per Unit		Total
Jan. 1		Inventory	7,200		$71.00		$511,200
10		Purchase	21,600		81.00		1,749,600
28		Sale	10,800		142.00		1,533,600
30		Sale	3,600		142.00		511,200
Feb. 5		Sale	1,440		142.00		204,480
10		Purchase	51,840		83.50		4,328,640
16		Sale	25,920		152.00		3,939,840
28		Sale	24,480		152.00		3,720,960
Mar. 5		Purchase	43,200		85.50		3,693,600
14		Sale	28,800		152.00		4,377,600
25		Purchase	7,200		86.00		619,200
30		Sale	25,200		152.00		3,830,400

Required:

1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 5, using the weighted average cost method. Round unit cost to two decimal places, if necessary. Round all total cost amounts to the nearest dollar.

Midnight Supplies Schedule of Cost of Goods Sold Weighted Average Cost Method For the Three Months Ended March 31
	Purchases			Cost of Goods Sold			Inventory
Date	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost
Jan. 1								$	$
Jan. 10		$	$
Jan. 28					$	$
Jan. 30
Feb. 5
Feb. 10
Feb. 16
Feb. 28
Mar. 5
Mar. 14
Mar. 25
Mar. 30
Mar. 31	Balances					$			$

2. Determine the total sales, the total cost of goods sold, and the gross profit from sales for the period.

Total sales	$
Total cost of goods sold	$
Gross profit	$

3. Determine the ending inventory cost as of March 31. $

Periodic inventory by three methods

The beginning inventory for Midnight Supplies and data on purchases and sales for a three-month period are shown below:

Date	Transaction	Number of Units		Per Unit		Total
Jan. 1	Inventory	7,500		$75.00		$562,500
10	Purchase	22,500		85.00		1,912,500
28	Sale	11,250		150.00		1,687,500
30	Sale	3,750		150.00		562,500
Feb. 5	Sale	1,500		150.00		225,000
10	Purchase	54,000		87.50		4,725,000
16	Sale	27,000		160.00		4,320,000
28	Sale	25,500		160.00		4,080,000
Mar. 5	Purchase	45,000		89.50		4,027,500
14	Sale	30,000		160.00		4,800,000
25	Purchase	7,500		90.00		675,000
30	Sale	26,250		160.00		4,200,000

1. Determine the inventory on March 31 and the cost of goods sold for the three-month period, using the first-in, first-out method and the periodic inventory system.

Inventory, March 31	$
Cost of goods sold	$

2. Determine the inventory on March 31 and the cost of goods sold for the three-month period, using the last-in, first-out method and the periodic inventory system.

Inventory, March 31	$
Cost of goods sold	$

3. Determine the inventory on March 31 and the cost of goods sold for the three-month period, using the weighted average cost method and the periodic inventory system. Round the weighted average unit cost to the nearest cent.

Inventory, March 31	$
Cost of goods sold	$

4. Compare the gross profit and the March 31 inventories, using the following column headings. For those boxes in which you must enter subtracted or negative numbers use a minus sign.

	FIFO	LIFO	Weighted Average
Sales	$	$	$
Cost of goods sold
Gross profit	$	$	$
Inventory, March 31	$	$	$