![]() Cost of goods sold schedule Under the FIFO method Date of purchaseĬost of Ending Inventory Under the FIFO method Date of purchaseĬ. 12,460Ĭost of ending inventory = WAC * Units on hand = 6.23 * 600 = Rs. ![]() Weighted average Cost (WAC) = Cost of goods available for sale / Units available for sale = 16,200 / 2,600 = Rs. However, this system is easy to adopt and competitively this system has a low cost of operation. Also, the cost of goods sold and the cost of ending inventory are the transactions they cannot be determined under this system. Under the periodic inventory system, it is difficult to determine the surplus and spoil of the inventories. After determining the cost of goods sold, cost of inventory is determined to deduct the cost of goods sold from the cost of goods available for sale. According to this system, the physical counting of inventory is made at the end of a certain period. The Periodic inventory system is also called a traditional inventory system. Periodic Inventory System Definition & Example Gross profit inventory estimation method.Under the weighted average cost (WAC) method.Calculation of COGS and cost of ending inventory.Example: In case of Decreasing unit cost. ![]()
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