ACCT 2050 at University of Minnesota--Twin Cities

7. Inventory Costing

in Topic 5 (Problem 7 of 8)

A company uses the periodic inventory system to account for inventories. Information related to the company’s inventory for the month of October is given below:

Date Units Unit Cost Total Cost
Beginning 150 2.20 330
Oct. 2 600 2.40 1,440
Oct. 10 500 2.50 1,250
Oct. 17 500 2.60 1,300
Oct. 28 700 2.70 1,890

During October the company sold 1,400 units at $6.00 per unit.

  1. Determine the value of Cost of Goods Sold using the Average Cost Method of inventory valuation.
    • $2,661
    • $3,472
    • $3,690
    • $3,548
  2. Determine Gross Profit for the month of October using the FIFO cost assumption.
    • $4,990
    • $4,710
    • $5,600
    • $3,410
  3. Determine Ending Inventory using the LIFO cost assumption
    • $2,800
    • $3,410
    • $2,520
    • $,3690
Watch Solution (8:41) Hide Solution Reveal Solution

The Rest Of The Practice Problems

Click Here to View All Topic 5 Problems at Once View
1 Consignment Inventory Easy
2 FOB Destination Easy
3 Inventory Set Aside Easy
4 Loss On Inventory Easy
5 FOB Shipping Moderate
6 FOB Shipping Moderate
7 Inventory Costing
You are here. 		Moderate
8 The Effect of Inventory Errors Hard
← Topic 4

Topic 5 Videos

1 COGS and Inventory 2:57
2 Net Sales 10:03
3 Perpetual vs Periodic 7:10
4 FOB Shipping? 8:51
5 Transportation In 8:41
6 COGS 6:18
7 Drawbacks to Periodic 6:07
8 Specific Identification 2:17
9 Weighted Average 4:21
10 FIFO and LIFO 20:17
11 Estimating with Gross Profit 7:23
Topic 6 →