Periodic Inventory Systems
Funky Fashions Uses a Periodic Inventory System

Essay

Periodic inventory systems
Funky Fashions uses a periodic inventory system. The beginning inventory of a particular product, and the purchases during the current year, were as follows:
At December 31, the ending inventory of this product consisted of 1,300 units.
Determine the cost of the year-end inventory and the cost of goods sold for this product under each of the following methods of inventory valuation:
$\begin{array}{|c|l|l|c|}\hline \operatorname{Jan} 1 & \text { Beginning inventory } & 400 \text { units } @ \$ 7.00= & \$ 2,800 \\\hline \text { Feb } 15 & \text { Purchase. } & 1,000 \text { units@\$7.50= } & 7,500 \\\hline \text { June } 30 & \text { Purchase } & 1,400 \text { units@ } \$ 8.00= & 11,200 \\\hline \text { Nov } 25 & \text { Purchase. } & 1,200 \text { units } @ \$ 8.25= & 9,900 \\\hline & \text { Total available for sale in year. } & \overline{\underline{4.000}} \text { units } &\$31,400 \\\hline\\\hline\end{array}$ $$\begin{array} { | l | l | l | l | } \hline & & \begin{array} { c } \text { Inventory at } \\\text { Dec. } 31\end{array} & \begin{array} { c } \text { Cost of } \\\text { Goods Sold }\end{array} \\\hline \text { (a) } & \text { Average cost } & \$\underline{\quad\quad} & \$\underline{\quad\quad} \\\hline \text { (b) } & \text { First-in, first-out } & \$\underline{\quad\quad} & \$\underline{\quad\quad} \\\hline \text { (c) } & \text { Last in, first-out } & \$ \underline{\quad\quad}& \$\underline{\quad\quad} \\ \hline & & & \\\hline\end{array}$$