FIFO LIFO

Topics: Cost of goods sold, 1984, FIFO and LIFO accounting Pages: 2 (133 words) Published: December 9, 2014
Q1: Assume Amazon .com began June with 10 units of inventory that cost a total of $190. During June, Amazon purchased and sold goods as follows: June 8
Purchase
30 units @ $20
June 14
Sale
25 units @ $40
June 22
purchase
20 unit @ $22
June 27
Sale
30 unit @ $40

Requirements: Under the FIFO and LIFO method
1. How much is Amazon’s cost of goods sold
2. How much is Amazon’s gross profit or loss
3. Journalize all Amazon’s inventory transactions for June. 4. Which method maximizes gross profit?
Q2: Collins Industries’ inventory records show the following data Inventory at January 1
400units
$2 each
Inventory purchase, March
200 units
$3 each
Sale, May
160 units

Inventory purchase, July
100 units
$ 4 each
Sale, September
460 units

Inventory purchase, November
250 units
$ 5 each

Requirements:
1- Journalize all inventory transactions
2- Calculate COGS due to FIFO and LIFO
3- Sales revenues were $4,000, calculate gross profit under each method.
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