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Prepare the trading statement where the FIFO method is used

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Reference no: EM132520308

Question - A firm uses a periodic inventory system. Details of an item of inventory disclosed:

1/1/2013 Opening Balance 100 units @ $88 per unit (including GST)

20/1/2013 Purchased 300 units @ $99 per unit (including GST)

2/2/2013 Sold 200 units @ $121 per unit (including GST)

18/4/2013 Purchased 400 units @ $104.50 per unit (including GST)

28/4/2013 Sold 150 units @ $121 per unit (including GST)

9/5/2013 Purchased 50 units @ $104.50 per unit (including GST)

15/7/2013 Purchased 100 units @ $110 per unit (including GST)

31/10/2013 Sold 300 units @ $132 per unit (including GST)

28/11/2013 Sold 50 units @ $132 per unit (including GST)

31/12/2013 Closing inventory on hand 250 units

Required -

(a) What is the value of ending inventory if the FIFO method of inventory costing is used?

(b) Prepare the general journal entry to record closing stock into the ledger using FIFO.

(c) Prepare the trading statement where the FIFO method is used.

(d) What is the value of ending inventory if the weighted average cost method of inventory costing is used?

(e) Prepare the general journal entry to record closing stock into the ledger using average cost.

(f) Prepare the trading statement where the FIFO method is used.

Reference no: EM132520308

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