Problem #3

Company A reported that a flood recently destroyed many of their financial records. The entity used average cost inventory valuation. The entity made a physical count at the end of each month in order to determine monthly ending inventory value. By examining various documents, the following data are gathered: Ending inventory at July 31 60,000 units Total cost of units available for sale in July 1,452,100 Cost of goods sold during July 1,164,100 Cost of beginning inventory, July 1 4.00 per unit Gross profit on sales for July 935,900

Units Unit Cost Total Cost July 5 55,000 5.1 280,500 July 11 53,000 5 265,000 July 15 45,000 5.5 247,500 July 16 47,000 5.3 249,100 Total purchases 200,000 1,042,100 Determine: (1) Cost of ending inventory on July 31 (2) Cost of goods sold under FIFO valuation method (3) Cost of ending inventory on July 31 under FIFO valuation method