Question

Bramble Corp. had 165 units in beginning inventory at a total cost of $19,800. The company purchased 330 units at a total cost of $44,550. At the end of the year, Bramble had 90 units in ending inventory. Compute the cost of the ending inventory and the cost of goods sold under FIFO, LIFO, and average-cost. (Round average-cost per unit and final answers to 0 decimal places, e.g. 1,250.) FIFO LIFO Average-cost The cost of the ending inventory $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places The cost of goods sold $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places $enter a dollar amount rounded to 0 decimal places eTextbook and Media Which cost flow method would result in the highest net income

Answer 1

A. FIFO

Cost of the ending inventory $12,150

Cost of goods sold $52,200

B. LIFO

Cost of the ending inventory $10,800

Cost of goods sold $53,550

C. AVERAGE COST

Cost of the ending inventory $11,700

Cost of goods sold $52,650

Step-by-step explanation:

A. Computation for the cost of the ending inventory and the cost of goods sold under FIFO

Cost of the ending inventory = 90 units*($44,550/330 units)

Cost of the ending inventory=90 units**135

Cost of the ending inventory=$12,150

Cost of goods sold =($44,550+$19,800)-$12,150

Cost of goods sold =$64,350-$12,150

Cost of goods sold =$52,200

2.Computation for the cost of the ending inventory and the cost of goods sold under LIFO

Cost of the ending inventory = 90 units*($19,800/165)

Cost of the ending inventory =90 units*$120

Cost of the ending inventory = $10,800

Cost of goods sold =($44,550+$19,800)-$10,800

Cost of goods sold =$64,350-$10,800

Cost of goods sold =$53,550

3.Computation for the cost of the ending inventory and the cost of goods sold under Average-cost

Cost of the ending inventory = 90 units*($44,550+$19,800)/(330 units+165 units)

Cost of the ending inventory = 90 units*($64,350/495 units)

Cost of the ending inventory = 90 units*$130

Cost of the ending inventory = $11,700

Cost of goods sold =($44,550+$19,800)-$11,700

Cost of goods sold =$64,350-$11,700

Cost of goods sold =$52,650