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Cortez Company sells chairs that are used at computer stations. Its beginning inventory of chairs was...

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Accounting

Cortez Company sells chairs that are used at computer stations.Its beginning inventory of chairs was 170 units at $42 per unit.During the year, Cortez made two batch purchases of this chair. Thefirst was a 295-unit purchase at $47 per unit; the second was a365-unit purchase at $49 per unit. During the period, it sold 515chairs

Determine the amount of product costs that would be allocated tocost of goods sold and ending inventory, assuming that Cortezuses

FIFO.

LIFO.

Weighted average.

Answer & Explanation Solved by verified expert
3.6 Ratings (432 Votes)

Units Rate Amt
Beginning Inventory 170 42 7140
First Batch-Purchase 295 47 13865
Second Batch-Purchase 365 49 17885
A Total Available 830 38890
Less: Units Sold 515
Closing Inventory 315
FIFO:
Units Sold: 515
Units Rate Amt
Beginning Inventory 170 42 7140
First Batch-Purchase 295 47 13865
Second Batch-Purchase 50 49 2450
B Total Sold Units 515 COGS 23455
A-B Closing Inventory 315 15435
LIFO
Units Sold: 515
Units Rate Amt
Second Batch-Purchase 365 49 17885
First Batch-Purchase 150 47 7050
B Total Sold Units 515 COGS 24935
A-B Closing Inventory 315 13955
Units Rate Amt
Beginning Inventory 170 42 7140
First Batch-Purchase 295 47 13865
Second Batch-Purchase 365 49 17885
Total Available 830 46.86 38890
Less: Units Sold 515 (38890/830)
Closing Inventory 315
Total Sold Units 515 COGS 24130.54 (46.86*515)
Closing Inventory 315 46.86 14759.46 (46.86*315)

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