Samuelson and Messenger (SAM) began 2021 with 260 units of its one product. These units were purchased near the end of 2020 for $22 each. During the month of January, 130 units were purchased on January 8 for $25 each and another 260 units were purchased on January 19 for $27 each. Sales of 165 units and 160 units were made on January 10 and January 25, respectively. There were 325 units on hand at the end of the month. SAM uses a periodic inventory system. Required: 1. Calculate ending inventory and cost of goods sold for January using FIFO. 2. Calculate ending inventory and cost of goods sold for January using average cost.

1. FIFO

ending inventory = $8,645

cost of goods sold = $7,345

2. Average Cost

ending inventory = $7,995

cost of goods sold = $7,995

Explanation:

The Period Inventory System is in use. This means that the Valuation of Inventory only happens at the end of the period and not as the per completion of transaction.

FIFO

FIFO assumes that the Inventory to be bought in first is the first to be sold.

Cost of Goods Sold  :

165 units × $22 = $3,630

95 units × $22 =  $2,090

65 units × $25 =   $1,625

Total                 =   $7,345

Ending Inventory :

65 units × $25   = $1,625

260 units × $27 = $7,020

Total                   = $8,645

Average Cost Method

An new average unit costs is calculated with every purchase made. But since this company uses periodic, we calculate a single unit cost.

Unit Cost = Total Cost ÷ Units Available for sale

                = (260 units × $22 + 130 units ×  $25 + 260 units × $27) ÷ 650 units

                = $24.60

Ending Inventory = Units in stock × Average Unit Cost

                             = 325 units × $24.60

                             = $7,995

Cost of Goods Sold = Units Sold × Average Unit Cost

                                 = 325 units × $24.60

                                 = $7,995

c). housing, savings, and food and d). housing, food, and transportation. i hope this is good luck on the rest of your work.

when consumers have more money to pay for a product, the most likely situation to occur from the possible options on the list is (2) an increase in price for computer and computer accessories will happen.

companies tend to price products according to production costs, but they also take into account how much money would a consumer in certain segments be willing to pay for their product. if they have more money, the products would definitely be priced higher.