Problem 2

Seltzer Corporation sells Item A as part of its product line. Information as to balances on hand,

purchases, and sales of Item A are given in the following table for the first six months of 2021.

January 1 balance, 400 units @ $2.00

Purchases:

January 24: 1,600 units @ $3.00

June 11: 1,000 units @ $4.00

Sales:

February 8: 300 units

March 16: 700 units

June 28: 800 units

Required:

Compute the ending inventory and cost of goods sold under each of the following inventory methods:

(a) Perpetual FIFO (first-in, first-out).

(b) Perpetual LIFO (last-in, first-out).

(c) Perpetual moving average.