Tool City,Inc.had 300 cordless screwdrivers on hand at January 1,2015 costing $45 each.Purchases and sales of cordless screwdrivers during the month of January were as follows:
$\begin{array}{lll}\text { Date } & \text { Purchases } & \text { Sales }\
\text { January } 9 & & 200 @ \$ 75 \
\text { January 14 } & 100 @ \$ 47 \
\text { January 23 } && 75 @ \$ 76 \
\text { January 25 } & 100 @ \$ 48 &\
\text { January 30 } && 75 @ \$ 77
\end{array}$
Tool City does not maintain perpetual inventory records.According to a physical count,150 cordless screwdrivers were on hand at January 31,2015.
Required:
a.What is the cost of the inventory at January 31,2015 under the FIFO method?
b.What is the cost of the inventory at January 31,2015 under the LIFO method?
c.What is the cost of the inventory at January 31,2015 under the FIFO method if only 145 cordless screwdrivers were on hand at the time of the physical count? Based on the data given,what is the most likely explanation for the fact that only 145 cordless screwdrivers were actually counted?

Question

Tool City,Inc.had 300 cordless screwdrivers on hand at January 1,2015 costing $45 each.Purchases and sales of cordless screwdrivers during the month of January were as follows:
$\begin{array}{lll}\text { Date } & \text { Purchases } & \text { Sales }\
\text { January } 9 & & 200 @ \$ 75 \
\text { January 14 } & 100 @ \$ 47 \
\text { January 23 } && 75 @ \$ 76 \
\text { January 25 } & 100 @ \$ 48 &\ 
\text { January 30 } && 75 @ \$ 77 
\end{array}$ 
Tool City does not maintain perpetual inventory records.According to a physical count,150 cordless screwdrivers were on hand at January 31,2015.
Required:
a.What is the cost of the inventory at January 31,2015 under the FIFO method?
b.What is the cost of the inventory at January 31,2015 under the LIFO method?
c.What is the cost of the inventory at January 31,2015 under the FIFO method if only 145 cordless screwdrivers were on hand at the time of the physical count? Based on the data given,what is the most likely explanation for the fact that only 145 cordless screwdrivers were actually counted?

Quizplus · Accepted Answer

The Answer of Tool City,Inc.had 300 cordless screwdrivers on hand at January 1,2015 costing $45 each.Purchases and sales of cordless screwdrivers during the month of January were as follows:
$\begin{array}{lll}\text { Date } & \text { Purchases } & \text { Sales }\
\text { January } 9 & & 200 @ \$ 75 \
\text { January 14 } & 100 @ \$ 47 \
\text { January 23 } && 75 @ \$ 76 \
\text { January 25 } & 100 @ \$ 48 &\ 
\text { January 30 } && 75 @ \$ 77 
\end{array}$ 
Tool City does not maintain perpetual inventory records.According to a physical count,150 cordless screwdrivers were on hand at January 31,2015.
Required:
a.What is the cost of the inventory at January 31,2015 under the FIFO method?
b.What is the cost of the inventory at January 31,2015 under the LIFO method?
c.What is the cost of the inventory at January 31,2015 under the FIFO method if only 145 cordless screwdrivers were on hand at the time of the physical count? Based on the data given,what is the most likely explanation for the fact that only 145 cordless screwdrivers were actually counted?

Tool City,Inc Tool City Does Not Maintain Perpetual Inventory Records