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Mower-Blower Sales Co. started business on January 20, 2019. Products sold were snow blowers and lawn mowers. Each product sold for $350. Purchases during 2019 were as follows: Blowers Mowers January 21 17 @ $ 201 February 3 48 @ 190 February 28 34 @ 188 March 13 16 @ 193 April 6 18 @ $ 214 May 22 45 @ 218 June 3 35 @ 218 June 20 70 @ 225 August 15 19 @ 218 September 20 18 @ 214 November 7 22 @ 201 The December 31, 2019, inventory included 11 blowers and 25 mowers. Assume the company uses a periodic inventory system. Required: a-1. Compute ending inventory valuation at December 31, 2019, under the FIFO and LIFO cost flow assumptions

Answer :

facundobuzzetti

Answer:

LIFO (last-in, first-out)= $191

FIFO (first-in, first-out)= 240.45

Explanation:

Giving the following information:

Purchases during 2019 were as follows:

January:

21 + 17= 38 units

Unitary cost= 201/38= 5.30

September

20+18=38

214/38= 5.64

November

201/29= 6.93

December 31, 2019, inventory included 11 blowers and 25 mowers.

Total inventory= 36 units

LIFO (last-in, first-out):

36*5.30= $191

FIFO (first-in, first-out)

29*6.93 + 7*5.64= 240.45

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