Aberdeen Company sold 2,200 cabinets during 2014 at $160 per cabinet. Its beginning inventory on January 1 was 130 cabinets at $56. Purchases made during the year were as follows.
February 225 cabinets @ $62.00
April 350 cabinets @ $65.00
June 700 cabinets @ $70.00
August 300 cabinets @ $66.00
October 400 cabinets @ $68.00
November 250 cabinets @ $72.00
The company’s selling and administrative expenses for the year were $101,000. The company uses the periodic inventory system.
Prepare a schedule to compute the cost of goods available for sale.
Units Price Total Cost
Beginning Inventory $ $
Purchases:
February $ $
April $ $
June $ $
August $ $
October $ $
November $ $
Cost of goods available for sale $
Compute income before income taxes under each of the following inventorycost flowassumptions: (a) theaverage-cost method, (b) theFIFO method, and (c) theLIFO method. In your calculations round average unit cost to the nearest cent, and round totals and your final answers to the nearest dollar.
Income before income taxes
Average-cost method: $
FIFO method: $
LIFO method: $
Computeinventory turnoveranddays' inventory on handunder each of the inventory cost flow assumptions in requirement 2. Round your answers to one decimal place. (Assume 365 days in a year.)
Average-Cost FIFO LIFO
Inventory turnover (times):
Days' inventory on hand (days):
