Lester Company Sells Many Products

question 235

Essay

Lester Company sells many products. Hackenberry is one of its popular items. Below is an analysis of the inventory purchases and sales of Hackenberry for the month of March. Lester Company uses the periodic inventory system. Instructions
(a) Using the FIFO assumption, calculate the amount charged to cost of goods sold for March. (Show computations)
(b) Using the weighted average method, calculate the amount assigned to the inventory on hand on March 31. (Show computations)
(c) Using the LIFO assumption, calculate the amount assigned to the inventory on hand on March 31. (Show computations)

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Definitions:

Process Costing

A costing method used in manufacturing where costs are assigned to batches or production runs, typically for homogeneous products.

Cost of Goods Completed

This term refers to the total cost incurred to manufacture products that have been completed during a specific period.

Processing Department

A division within a factory where a specific type of production activity or process takes place.

Work in Process

Inventory category referring to goods that are in the process of being manufactured but are not yet completed.