Financial Reporting and Analysis Q225
225A firm which prepares its financial statements according to U.S. GAAP and uses a periodic inventory system had the following transactions during the year:
| Date | Activity | Tons (000s) | $ per Ton |
| Beginning inventory | 1 | 500 | |
| Feb | Purchase | 8 | 540 |
| May | Sale | 5 | 600 |
| July | Purchase | 2 | 575 |
| Nov | Sale | 3 | 620 |
The cost of sales (in ‘000s) is closest to:
- Option : C
- Explanation : FIFO: Cost of Sales = 1 * 500 + 7 *540 = 4,280 LIFO: Cost of Sales = 2 * 575 + 6 * 540 = 4,390 WA: Total units = 11 Total cost = 5,970 Cost of Sales = 5,970/11 * 8 = 4,342
Accessibility
Oversized Widget
Saved in this browser. Nothing changes for anyone else.