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XYZ CorporationScenario: Calculate Cost of Goods Sold (COGS) using FIFOData:Beginning Inventory: 500 units at $10 per...

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Accounting

XYZ Corporation

Scenario: Calculate Cost of Goods Sold (COGS) using FIFO

Data:

  • Beginning Inventory: 500 units at $10 per unit
  • Purchases:
    • March 1: 1,000 units at $12 per unit
    • July 1: 800 units at $14 per unit
  • Sales: 1,200 units sold during the year
  • Ending Inventory: 600 units

Requirements:

  1. Calculate the Cost of Goods Sold (COGS) using the FIFO method.
  2. Determine the value of Ending Inventory using the FIFO method.
  3. Discuss how FIFO impacts XYZ Corporation’s income statement.
  4. Analyze the financial statement presentation differences between FIFO and LIFO.

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