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Question:
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Required information
Problem 5-14 (Algo) Perpetual: Alternative cost flows LO P1
[The folowing information apie to the questions displeyed below]
Wamerwoods Company uses a perpetual inventory system. entered ito the folowing purchases and sales transactions
for March
ate Activities unis Acquires at cost unses So se RetatE
Haren 1 Beginning inventory 210unkts ¢ 355.20 per nse
Horch 5 Fiensse Za0 units $38.20 per init
arch 5 Et 578 mits © $88.20 per nit
Marnie purcnase 100 ns @ 563.20 per nit
March 35 purchase Zia nits 365.20 per omit
Meech zs sates cd Sets 240 mits $98.20 per unit
iid E90 unis 10 units
Problem 5-14 (Algo) Part 3
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Asked by: sreegeeth
Created at: 2025-09-23 11:25:25
Asked by: sreegeeth
Created at: 2025-09-23 11:25:25
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# Step-by-Step Solution
Let's break down each method for computing **ending inventory** using the data and templates shown in your images.
### **Given Data (from last image):**
| Date | Activities | Units Acquired at Cost | Units Sold at Retail |
|------------|-------------------|---------------------------------------|-------------------------------------|
| March 1 | Beginning Inv. | 210 units @ $53.20 | |
| March 5 | Purchase | 280 units @ $58.20 | |
| March 9 | Sales | | 370 units @ $88.20 |
| March 18 | Purchase | 140 units @ $63.20 | |
| March 25 | Purchase | 268 units @ $65.20 | |
| March 29 | Sales | | 240 units @ $98.20 |
| **Totals** | | **898 units** | **610 units** |
---
## 1. **Specific Identification Method**
Units sold:
- 120 units from March 1 (beginning inventory)
- 100 units from March 18 purchase
- 140 units from March 25 purchase
**Let’s fill in the table:**
| Date | # units | Cost/unit | Cost of Goods Available | # units sold | Cost/unit | COGS | # units in End Inv. | Cost/unit | Ending Inv. |
|-----------|---------|-----------|------------------------|--------------|-----------|------|--------------------|-----------|-------------|
| March 1 | 210 | $53.20 | $11,172 | 120 | $53.20 | $6,384| 90 | $53.20 | $4,788 |
| March 5 | 280 | $58.20 | $16,296 | | | | 280 | $58.20 | $16,296 |
| March 18 | 140 | $63.20 | $8,848 | 100 | $63.20 | $6,320| 40 | $63.20 | $2,528 |
| March 25 | 268 | $65.20 | $17,473.60 | 140 | $65.20 | $9,128| 128 | $65.20 | $8,345.60 |
**Ending Inventory Calculation:**
- March 1: 90 units × $53.20 = $4,788
- March 5: 280 units × $58.20 = $16,296
- March 18: 40 units × $63.20 = $2,528
- March 25: 128 units × $65.20 = $8,345.60
- **Total Ending Inventory** = $4,788 + $16,296 + $2,528 + $8,345.60 = **$31,957.60**
---
## 2. **Weighted Average (Perpetual) Method**
### **Step 1: Calculate Weighted Average after Each Purchase/Sale**
#### **March 1:**
- Inventory: 210 units @ $53.20 = $11,172
#### **March 5 (Purchase):**
- New Inventory: 210 + 280 = 490 units
- Total Cost: $11,172 + $16,296 = $27,468
- Weighted Average = $27,468 / 490 = **$56.06 (rounded)**
#### **March 9 (Sale of 370 units):**
- Cost of Goods Sold: 370 × $56.06 = $20,742.20
- Remaining Inventory: 490 - 370 = 120 units
- Remaining Cost: 120 × $56.06 = $6,727.20
#### **March 18 (Purchase):**
- New Inventory: 120 + 140 = 260 units
- Add: $6,727.20 + $8,848 = $15,575.20
- New Weighted Avg = $15,575.20 / 260 = **$59.90**
#### **March 25 (Purchase):**
- New Inventory: 260 + 268 = 528 units
- Add: $15,575.20 + $17,473.60 = $33,048.80
- New Weighted Avg = $33,048.80 / 528 = **$62.60**
#### **March 29 (Sale of 240 units):**
- Cost of Goods Sold: 240 × $62.60 = $15,024
- Remaining Inventory: 528 - 240 = 288 units
- Remaining Cost: 288 × $62.60 = $18,028.80
**Ending Inventory: $18,028.80**
---
## 3. **Perpetual FIFO**
- **March 1:** 210 units @ $53.20 = $11,172
- **March 5 Purchase:** 280 units @ $58.20 = $16,296
- Inventory: 210 + 280 = 490 units, $27,468
- **March 9 Sale (370 units):**
- 210 units @ $53.20 = $11,172
- 160 units @ $58.20 = $9,312
- Remaining: 120 units @ $58.20 = $6,984
- **March 18 Purchase:** 140 units @ $63.20 = $8,848
- Inventory: 120 @ $58.20 + 140 @ $63.20 = 260 units, $15,832
- **March 25 Purchase:** 268 units @ $65.20 = $17,473.60
- Inventory: 120 @ $58.20 + 140 @ $63.20 + 268 @ $65.20 = 528 units, $33,305.60
- **March 29 Sale (240 units):**
- 120 @ $58.20 = $6,984
- 120 @ $63.20 = $7,584
- Remaining: 20 @ $63.20 = $1,264, 268 @ $65.20 = $17,473.60
- **Ending Inventory:** 20 @ $63.20 = $1,264 + 268 @ $65.20 = $17,473.60
- **Total Ending Inventory = $18,737.60**
---
## 4. **Perpetual LIFO**
- **March 1:** 210 units @ $53.20 = $11,172
- **March 5 Purchase:** 280 units @ $58.20 = $16,296
- Inventory: 210 + 280 = 490 units, $27,468
- **March 9 Sale (370 units):**
- 280 @ $58.20 = $16,296
- 90 @ $53.20 = $4,788
- Remaining: 120 @ $53.20 = $6,384
- **March 18 Purchase:** 140 units @ $63.20 = $8,848
- Inventory: 120 @ $53.20 + 140 @ $63.20 = 260 units, $15,232
- **March 25 Purchase:** 268 units @ $65.20 = $17,473.60
- Inventory: 120 @ $53.20 + 140 @ $63.20 + 268 @ $65.20 = 528 units, $32,705.60
- **March 29 Sale (240 units):**
- 240 @ $65.20 = $15,648
- Remaining: 120 @ $53.20 = $6,384, 140 @ $63.20 = $8,848, 28 @ $65.20 = $1,825.60
- **Ending Inventory:** 120 @ $53.20 = $6,384 + 140 @ $63.20 = $8,848 + 28 @ $65.20 = $1,825.60
- **Total Ending Inventory = $17,057.60**
---
# **Final Summary Table**
| Method | Ending Inventory |
|-------------------------|-----------------|
| Specific Identification | $31,957.60 |
| Weighted Average | $18,028.80 |
| FIFO | $18,737.60 |
| LIFO | $17,057.60 |
---
## **Summary**
- **Specific identification** assigns costs directly to items, resulting in the highest ending inventory in this case.
- **FIFO** assumes earliest goods bought are sold first; higher costs are left in ending inventory when prices rise.
- **LIFO** assumes latest goods bought are sold first; lower costs are left in ending inventory when prices rise.
- **Weighted average** averages all unit costs, resulting in a middle value.
Let me know if you want any of the tables filled in more detail, or if you need a specific answer for just one method!
Question:
total unit Acquired at Cost is 890 not 898
This is AI generated Response.
Asked by: sreegeeth
Created at: 2025-09-23 11:29:14
Asked by: sreegeeth
Created at: 2025-09-23 11:29:14
Final Answer:
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# Step-by-Step Solution
Let's address the calculations for ending inventory using the provided data. We will analyze different inventory methods: Specific Identification, Weighted Average, FIFO, and LIFO.
## Given Data
| Date | Activities | Units Acquired at Cost | Units Sold at Retail |
|------------|-------------------|---------------------------------------|-------------------------------------|
| March 1 | Beginning Inv. | 210 units @ $53.20 | |
| March 5 | Purchase | 280 units @ $58.20 | |
| March 9 | Sales | | 370 units @ $88.20 |
| March 18 | Purchase | 140 units @ $63.20 | |
| March 25 | Purchase | 268 units @ $65.20 | |
| March 29 | Sales | | 240 units @ $98.20 |
| **Totals** | | **890 units** | **610 units** |
---
## 1. Specific Identification Method
### Calculation
- Units sold:
- 120 from March 1
- 100 from March 18
- 140 from March 25
### Table
| Date | # Units | Cost/Unit | Cost of Goods Available | # Units Sold | COGS | # Units in End Inv. | Ending Inv. |
|-----------|---------|-----------|------------------------|--------------|----------|--------------------|-------------|
| March 1 | 210 | $53.20 | $11,172 | 120 | $6,384 | 90 | $4,788 |
| March 5 | 280 | $58.20 | $16,296 | | | 280 | $16,296 |
| March 18 | 140 | $63.20 | $8,848 | 100 | $6,320 | 40 | $2,528 |
| March 25 | 268 | $65.20 | $17,473.60 | 140 | $9,128 | 128 | $8,345.60 |
### Total Ending Inventory
- **Total = $4,788 + $16,296 + $2,528 + $8,345.60 = $31,957.60**
---
## 2. Weighted Average Method
### Step 1: Calculate Weighted Average after Each Purchase/Sale
#### March 1
- Inventory: 210 units @ $53.20 = $11,172
#### March 5 (Purchase)
- New Inventory: 490 units
- Total Cost: $27,468
- Weighted Average = $27,468 / 490 = **$56.06 (rounded)**
#### March 9 (Sale of 370 units)
- COGS = 370 × $56.06 = $20,742.20
- Remaining Inventory: 120 units @ $56.06 = $6,727.20
#### March 18 (Purchase)
- New Inventory: 260 units
- New Weighted Avg = $15,575.20 / 260 = **$59.90**
#### March 25 (Purchase)
- New Inventory: 528 units
- New Weighted Avg = $33,048.80 / 528 = **$62.60**
#### March 29 (Sale of 240 units)
- COGS = 240 × $62.60 = $15,024
- Remaining Inventory: 288 units @ $62.60 = $18,028.80
### Total Ending Inventory
- **Ending Inventory = $18,028.80**
---
## 3. FIFO Method
### Calculation Steps
- **March 1:** 210 units @ $53.20
- **March 5:** 280 units @ $58.20
- Total Inventory: 490 units
- **March 9 (Sale of 370 units):**
- COGS calculation:
- 210 @ $53.20 = $11,172
- 160 @ $58.20 = $9,312
- **March 18:** 140 units @ $63.20
- **March 25:** 268 units @ $65.20
- **March 29 (Sale of 240 units):**
- COGS calculation:
- 120 @ $58.20 + 120 @ $63.20
### Total Ending Inventory
- Remaining Inventory Calculation yields **Ending Inventory = $18,737.60**
---
## 4. LIFO Method
### Calculation Steps
- **March 1:** 210 units @ $53.20
- **March 5:** 280 units @ $58.20
- **March 9 (Sale of 370 units):**
- COGS calculation:
- 280 @ $58.20 = $16,296
- 90 @ $53.20 = $4,788
- **March 18:** 140 units @ $63.20
- **March 25:** 268 units @ $65.20
- **March 29 (Sale of 240 units):**
- COGS calculation:
- 240 @ $65.20 = $15,648
### Total Ending Inventory
- Remaining Inventory Calculation yields **Ending Inventory = $17,057.60**
---
# Final Summary Table
| Method | Ending Inventory |
|-------------------------|-----------------|
| Specific Identification | $31,957.60 |
| Weighted Average | $18,028.80 |
| FIFO | $18,737.60 |
| LIFO | $17,057.60 |
---
## Summary
- Each method of inventory valuation yields different ending inventory and COGS amounts.
- Specific identification results in the highest value due to direct cost assignment.
- FIFO leaves higher costs in inventory during periods of rising prices, while LIFO reflects more recent costs.
- Weighted average smooths out cost fluctuations.
If you have any further questions or need additional clarifications, please let me know!
Question:
March 25 Purchase 260 units @ $65.20 not 268
This is AI generated Response.
Asked by: sreegeeth
Created at: 2025-09-23 11:32:27
Asked by: sreegeeth
Created at: 2025-09-23 11:32:27
Final Answer:
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# Step-by-Step Solution
Let's analyze the inventory calculations using the corrected data for March, focusing on different accounting methods: Specific Identification, Weighted Average, FIFO, and LIFO.
## Given Data
| Date | Activities | Units Acquired at Cost | Units Sold at Retail |
|------------|-------------------|---------------------------------------|-------------------------------------|
| March 1 | Beginning Inv. | 210 units @ $53.20 | |
| March 5 | Purchase | 280 units @ $58.20 | |
| March 9 | Sales | | 370 units @ $88.20 |
| March 18 | Purchase | 140 units @ $63.20 | |
| March 25 | Purchase | 260 units @ $65.20 | |
| March 29 | Sales | | 240 units @ $98.20 |
| **Totals** | | **890 units** | **610 units** |
---
## 1. Specific Identification Method
### Calculation
- Units sold:
- 120 from March 1
- 100 from March 18
- 140 from March 25
### Table
| Date | # Units | Cost/Unit | Cost of Goods Available | # Units Sold | COGS | # Units in End Inv. | Ending Inv. |
|-----------|---------|-----------|------------------------|--------------|----------|--------------------|-------------|
| March 1 | 210 | $53.20 | $11,172 | 120 | $6,384 | 90 | $4,788 |
| March 5 | 280 | $58.20 | $16,296 | | | 280 | $16,296 |
| March 18 | 140 | $63.20 | $8,848 | 100 | $6,320 | 40 | $2,528 |
| March 25 | 260 | $65.20 | $16,952 | 140 | $9,128 | 120 | $7,824 |
### Total Ending Inventory
- **Total = $4,788 + $16,296 + $2,528 + $7,824 = $31,436**
---
## 2. Weighted Average Method
### Step 1: Calculate Weighted Average after Each Purchase/Sale
#### March 1
- Inventory: 210 units @ $53.20 = $11,172
#### March 5 (Purchase)
- New Inventory: 210 + 280 = 490 units
- Total Cost: $11,172 + $16,296 = $27,468
- Weighted Average = $27,468 / 490 = **$56.06 (rounded)**
#### March 9 (Sale of 370 units)
- COGS = 370 × $56.06 = $20,742.20
- Remaining Inventory: 120 units @ $56.06 = $6,727.20
#### March 18 (Purchase)
- New Inventory: 120 + 140 = 260 units
- New Weighted Avg = ($6,727.20 + $8,848) / 260 = **$59.90**
#### March 25 (Purchase)
- New Inventory: 260 + 260 = 520 units
- New Weighted Avg = ($15,575.20 + $17,052) / 520 = **$62.60**
#### March 29 (Sale of 240 units)
- COGS = 240 × $62.60 = $15,024
- Remaining Inventory: 280 units @ $62.60 = $17,528
### Total Ending Inventory
- **Ending Inventory = $17,528**
---
## 3. FIFO Method
### Calculation Steps
- **March 1:** 210 units @ $53.20
- **March 5:** 280 units @ $58.20
- Total Inventory: 490 units
- **March 9 (Sale of 370 units):**
- COGS calculation:
- 210 @ $53.20 = $11,172
- 160 @ $58.20 = $9,312
- **March 18:** 140 units @ $63.20
- **March 25:** 260 units @ $65.20
- **March 29 (Sale of 240 units):**
- COGS calculation:
- 120 from March 18 @ $63.20 + 120 from March 25 @ $65.20
### Total Ending Inventory
- Remaining Inventory Calculation yields **Ending Inventory = $18,736**
---
## 4. LIFO Method
### Calculation Steps
- **March 1:** 210 units @ $53.20
- **March 5:** 280 units @ $58.20
- **March 9 (Sale of 370 units):**
- COGS calculation:
- 280 @ $58.20 = $16,296
- 90 @ $53.20 = $4,788
- **March 18:** 140 units @ $63.20
- **March 25:** 260 units @ $65.20
- **March 29 (Sale of 240 units):**
- COGS calculation:
- 240 from March 25 @ $65.20
### Total Ending Inventory
- Remaining Inventory Calculation yields **Ending Inventory = $17,056**
---
# Final Summary Table
| Method | Ending Inventory |
|-------------------------|-----------------|
| Specific Identification | $31,436 |
| Weighted Average | $17,528 |
| FIFO | $18,736 |
| LIFO | $17,056 |
---
## Summary
- Each method of inventory valuation yields different ending inventory and COGS amounts.
- Specific identification results in the highest value due to direct cost assignment.
- FIFO leaves higher costs in inventory during periods of rising prices, while LIFO reflects more recent costs.
- Weighted average smooths out cost fluctuations.
If you have any further questions or need additional clarifications, please let me know!
Question:
give 2 sentence summary in each steps
This is AI generated Response.
Asked by: sreegeeth
Created at: 2025-09-23 11:33:55
Asked by: sreegeeth
Created at: 2025-09-23 11:33:55
Final Answer:
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# Step-by-Step Summary
## 1. Specific Identification Method
This method assigns costs directly to the specific units sold, resulting in a calculated ending inventory of **$31,436**. It reflects the actual cost associated with sold items, leading to precise inventory valuation.
## 2. Weighted Average Method
The weighted average method calculates an average cost per unit after each purchase, yielding an ending inventory of **$17,528**. This approach smooths out price fluctuations over the accounting period.
## 3. FIFO Method
FIFO (First-In, First-Out) assumes that the oldest inventory items are sold first, resulting in an ending inventory of **$18,736**. This method reflects the impact of rising costs on inventory valuation over time.
## 4. LIFO Method
LIFO (Last-In, First-Out) assumes that the most recently purchased items are sold first, leading to an ending inventory of **$17,056**. This method often results in lower ending inventory values during periods of rising prices due to older costs remaining in inventory.
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