Orion Iron Corporation tracks thenumber of units purchased and soldthroughout each year but applies itsinventory costing method perpetuallyat the time of each sale, as if it usesperpetual inventory system. Assume itsaccounting records provided thefollowing information at the end of theannual accounting period, December31. Transactions Units Unit Cost a.Inventory, Beginning 200 $ 12 For theyear: b. Purchase, April 11 950 9 c.Purchase, June 1 850 13 d. Sale, May 1(sold for $40 per unit) 200 e. Sale, July3 (sold for $40 per unit) 700 f.Operating expenses (excluding incometax expense), $18,500 Required:Calculate the cost of ending inventoryand the cost of goods sold using theFIFO and LIFO methods.

Under FIFO Method, units that come in first will be sold first and the units that come in last will…

Answered: Calculate the cost of ending inventory…

Business

Accounting

Calculate the cost of ending inventory and the cost of goods sold using the FIFO and LIFO methods.

Financial Accounting

15th Edition

ISBN:9781337272124

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter7: Inventories

Section: Chapter Questions

Problem 5PA: Dymac Appliances uses the periodic inventory system. Details regarding the inventory of appliances...

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Question

Orion Iron Corporation tracks the
number of units purchased and sold
throughout each year but applies its
inventory costing method perpetually
at the time of each sale, as if it uses
perpetual inventory system. Assume its
accounting records provided the
following information at the end of the
annual accounting period, December
31. Transactions Units Unit Cost a.
Inventory, Beginning 200 $ 12 For the
year: b. Purchase, April 11 950 9 c.
Purchase, June 1 850 13 d. Sale, May 1
(sold for $40 per unit) 200 e. Sale, July
3 (sold for $40 per unit) 700 f.
Operating expenses (excluding income
tax expense), $18,500 Required:
Calculate the cost of ending inventory
and the cost of goods sold using the
FIFO and LIFO methods.

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