Question

Using the following information please prepare a schedule of cost of goods sold and calculate the value of ending inventory and cost of goods of sold included in the Schedule of Cost of Goods Sold for the year ended December 31, 2019, Using FIFO, First In First Out The total Inventory valuation using FIFO on December 31, 2018 was 2,000 units at a cost of $10 per unit. On June 30, 2019 the company purchased 5,000 units at cost of $20 per unit. On September 30, 2019 the company purchased 3,000 units at a cost of $30 per unit. On December 1, 2019 the company sold 6,000 units.

Answer 1

Ending inventory= $110,000

COGS= $100,000

Step-by-step explanation:

Giving the following information:

Beginning inventory=2,000 units for $10 per unit.

Purchases:

June 30, 2019= 5,000 units at cost of $20 per unit.

September 30, 2019= 3,000 units for $30 per unit.

On December 1, 2019 the company sold 6,000 units.

Using the FIFO (first-in; first-out) inventory method, the value of ending inventory is calculated using the cost of the last units incorporated into inventory.

Ending inventory in units= 10,000 - 6,000= 4,000

Ending inventory= 3,000*30 + 1,000*20= $110,000

COGS= 2,000*10 + 4,000*20= $100,000