Sheffield Company had 100 units in beginning inventory at a total cost of $12,000. The company purchased 200 units at a total cost of $30,000. At the end of the year, Sheffield had 71 units in ending inventory.
Compute the cost of the ending inventory and the cost of goods sold under FIFO, LIFO, and average-cost. (Round average-cost per unit and final answers to 0 decimal places, e. g. 1,250.)

FIFO

Cost of goods sold = $19,350 + 12,000 = $31,350.

Ending inventory = 71 × $150 = $10,650

LIFO

Total cost of goods sold = $3480 + $30,000 = $33,480

Cost of ending inventory = $120 × 71 = $8520

Average-cost inventory system:

Cost of goods sold = 229 × 140 = $32,060

Ending inventory = 71 × $140 = $9,940

Explanation:

The FIFO inventory system means first in, first out. It means that the first purchased goods at the first to be sold.

The cost of goods sold under FIFO :

Total amount of goods sold × cost of goods

Total amount of goods sold = Total available goods - ending inventory

300 - 71 = 229

It is assumed that the first 100 goods sold is taken from the beginning inventory which costs  $12,000.

The remaining 129 goods is taken from the goods purchased.

To get the unit cost of the goods purchased =  $30,000 / 200 = $150

Total cost of 129 inventory = $150 × 129 = $19,350

Cost of goods sold = $19,350 + 12,000 = $31,350.

Ending inventory = 71 × $150 = $10,650

The LIFO mwans last in, first out. This inventory system assumes that It is the last purchased inventory that is first to be sold

Total amount of goods sold = Total available goods - ending inventory

300 - 71 = 229

It is assumed that the first 200 are sold from the later acquired inventory. This costs  $30,000.

The remaining 29, would be sold from the beginning inventory.

Unit cost of beginning inventory = $12,000 / 100 = $120

Total cost of 29 inventory sold = $120 × 29 = $3480

Total cost of goods sold = $3480 + $30,000 = $33,480

Cost of ending inventory = $120 × 71 = $8520

Average cost inventory system = Total cost of inventory/ total units of inventory

($30,000 + $12,000) / (100 + 200) = $140

Cost of goods sold = 229 × 140 = $32,060

Ending inventory = 71 × $140 = $9,940

I hope my answer helps you

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