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which one of these is correct A) B) ...

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Accounting

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which one of these is correct
A)
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B)
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The accounting records of Shumway Ag Implement show the following. Unit Cost $3 1/1 Beginning Inventory 1/20 Purchase 7/25 Sale Units 4,000 6,000 5000 Total Cost S 12000 24,000 12 Total 10,000 S36,000 A Physical Count of Merchandise inventory on July 31 reveals that there are 2000 units on hand Requirement: Determine the cost of goods sold during the period under a periodic inventor system using A) The FIFO method B) The average cost method. A) FIFO method COGS = (4000X3) + (1000X4) = 16,000 B) Average cost method 1- Cost per unit = total cost / total unit = 36,000 / 10,000 =3.6 2- COGS = 5000 X 3.6 =18,000 A) FIFO method Ending inventory = 2,000 X 4 = 8,000 COGS = total cost - ending inventory = 36,000 - 8,000 = 28,000 B) Average cost method 1- Cost per unit = total cost / total unit = 36,000 / 10,000 =3.6 2- Ending inventory = 2000 X 3.6 = 7,200 3- COGS = total cost - ending inventory = 36,000 - 7,200 =28,800

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