Bold Stapler Sales Company (BSS) began 2019 with cash of $80,000, inventory of $7,200 (400 staplers that cost $18 each), $2,000 of common stock, and $2,000 of retained earnings. The following events occurred during 2019. 1. BSS purchased additional inventory twice during 2019. The first purchase consisted of 1,600 staplers that cost $21 each, and the second consisted of 2,400 staplers that cost $25 each. The purchases were on account.
2. The company sold 4,220 staplers for cash at a selling price of $45 each.
Required: Determine the ending inventory and cost of goods sold using the three different cost flow assumptions: FIFO, LIFO, and Weighted Average.

Bold Stapler Sales Company (BSS)

                                     FIFO             LIFO           Weighted Average

Ending inventory       $4,500         $3,240                 $4,122

Cost of goods sold $96,300      $97,560              $96,678

Explanation:

a) Data and Calculations:

Beginning balances in 2019:

Cash $80,000

Inventory $7,200

Common stock $2,000

Retained earnings $2,000

Description                    Units   Unit Cost   Total

Beginning inventory        400      $18      $7,200

The first purchase        1,600      $21       33,600

The second purchase 2,400     $25       60,000

Goods available           4,400               $100,800

Sales of units              (4,220)    $45   $189,900

Ending inventory             180

FIFO:

Ending inventory = $4,500 ($25 * 180)

Cost of goods sold = $96,300 ($100,800 - $4,500)

LIFO:

Ending inventory = $3,240 ($18 * 180)

Cost of goods sold = $97,560 ($100,800 - $3,240)

Weighted Average:

Weighted average cost per unit = $22.91 ($100,800/4,400)

Ending inventory = $4,122 (22.91 * 180)

Cost of goods sold = $96,678 ($100,800 - $4,122)

answersecondary succession;