8-存货与销货成本(76).ppt

To calculate Cost of Goods Sold for the period, start with Goods Available for Sale of $9,725 dollars and subtract Ending Inventory, based on the physical count, of $6,400. When using average cost, assign the average cost of the goods available for sale to cost of goods sold. The average cost is determined by dividing the cost of goods available for sale for the period by the units available for sale for the period. Let’s see how this works. Part I First, determine the average cost by taking Goods Available for Sale for the period and divide it by the number of units available for sale during the period. In this example, this calculation would be $9,725 divided by 1,800 units. The average cost is 5.40278 dollars. Part II To determine Ending Inventory, take the number of units in inventory and multiply by the average cost. To determine Cost of Goods Sold, take the number of units sold and multiply by the average cost. When using FIFO, assign the older costs to the units sold. That leaves the more recent costs to be used to value ending inventory. For Computers, Incorporated, there are 1,200 units in Ending Inventory. To determine their cost using FIFO, start with the most recent purchase and then add other purchases until 1,200 units are accounted for. Let’s see how this works. Part I Start with the November 29th purchase of 150 units. Part II Add the units from the September 15th purchase, the June 20th purchase, the January 3rd purchase, and 400 units from the beginning inventory. This accounts for all 1,200 units on hand. The cost of these units is determined by taking the units times their respective cost amount. Part III Ending Inventory is $6,575. The Cost of Goods Sold value for the 600 units sold is determined using the first costs in. Start with the beginning inventory and account for all 600 units. The Cost of Goods Sold is $3,105. As a double check, when you add together the Ending Inventory and the Cost of Goods Sold, you sho