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Calculate the value of ending inventory

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Question - You are provided with the following information for Crane Inc. Crane Inc. uses the periodic method of accounting for its inventory transactions.

March 1 Beginning inventory 2,000 liters at a cost of 60¢ per liter.

March 3 Purchased 2,500 liters at a cost of 64¢ per liter.

March 5 Sold 2,300 liters for $1.05 per liter.

March 10 Purchased 4,000 liters at a cost of 71¢ per liter.

March 20 Purchased 2,200 liters at a cost of 79¢ per liter.

March 30 Sold 5,000 liters for $1.25 per liter.

(a) Calculate the value of ending inventory that would be reported on the balance sheet, under each of the following cost flow assumptions.

(1) Specific identification method assuming:

(i) The March 5 sale consisted of 1,000 liters from the March 1 beginning inventory and 1,300 liters from the March 3 purchase; and

(ii) The March 30 sale consisted of the following number of units sold from beginning inventory and each purchase: 450 liters from March 1; 550 liters from March 3; 2,900 liters from March 10; 1,100 liters from March 20.

(2) FIFO

(3) LIFO.

Reference no: EM132217762

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