Q1 (10 Marks)

During June, the following changes in inventory item 27 took place:

June 1 Balance 1,400 units @ 24

14 Purchased 900 units @ 36

24 Purchased 700 units @ 30

8 Sold 400 units @ 50

10 Sold 1,000 units @ 40

29 Sold 500 units @ 44

Perpetual inventories are maintained in units only.

Instructions

What is the cost of the ending inventory for item 27 under the following methods? (Show calculations.)

(a) FIFO.

(b) Average Cost.