Chapter 7 HW: 4

Periodic Inventory by Three Methods

Dymac Appliances uses the periodic inventory system. Details regarding the inventory of appliances at January 1, purchases invoices during the next 12 months, and the inventory count at December 31 are summarized as follows:

Purchases Invoices
Model	Inventory, January 1		1st		2nd		3rd		Inventory Count, December 31
A10	__		4 at	$ 36	4 at	$ 39	4 at	$ 42	5
B15	8 at	$ 83	4 at	74	3 at	80	6 at	87	7
E60	3 at	71	3 at	61	15 at	64	9 at	66	5
G83	7 at	242	6 at	250	5 at	260	10 at	259	9
J34	12 at	64	10 at	66	16 at	73	16 at	74	13
M90	2 at	118	2 at	120	3 at	138	3 at	140	5
Q70	5 at	166	4 at	176	4 at	181	7 at	186	8

Required:

1. Determine the cost of the inventory on December 31 by the first-in, first-out method.

If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. If units are in inventory at two different costs, enter the units PURCHASED MOST RECENTLY first.

2. Determine the cost of the inventory on December 31 by the last-in, first-out method.

If the inventory of a particular model comprises one entire purchase plus a portion of another purchase acquired at a different unit cost, use a separate line for each purchase. If units are in inventory at two different costs, enter the OLDEST units first.

3. Determine the cost of the inventory on December 31 by the weighted average cost method.

4. (FIFO or LIFO) would be preferred for income tax purposes in periods of rising prices.

Dymac Appliances Cost of the Inventory-FIFO Method December 31 Model Quantity Unit Cost Total Cost A10 $ $ $ A10 B15 B15 E60 G83 Tillllllllll 134 M90 M90 070 Q70 Total $ Dymac Appliances Cost of the Inventory-LIFO Method December 31 Model Quantity Unit Cost Total Cost A10 A10 B15 E60 E60 G83 G83 134 334 M90 M90 M90 070 070 Total OT Dymac Appliances Cost of the Inventory-Weighted Average Method December 31 Model Quantity Unit Cost Total Cost A10 $ $ B15 E60 G83 IIIII 334 M90 070 III Total $