The Units of Product YY2 Available for Sale During the Year

question 17

Essay

The units of Product YY2 available for sale during the year were as follows:
$\begin{array}{lll}\$ 30 \text { each } & \text { at } & 16 \text { units }&\text { Inventory } & \text { Apr. } 1 \\\$ 33 \text { each } & \text { at } & 30 \text { units } &\text { Purchase } & \text { Jun. } 16 \\\$ 37 \text { each } & \text { at } & 45 \text { units }&\text { Purchase } & \text { Sep. } 28\end{array}$
There are 17 units of the product in the physical ending inventory at March 31. The periodic inventory system is used. Determine the ending inventory cost by (a) FIFO, (b) LIFO, and (c) average cost methods.

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Definitions:

Opportunity Cost

The cost of foregoing the next best alternative when making a decision, representing the benefits one could have received by taking a different decision.

Opportunity Cost

The economic consequence of not opting for the immediate secondary option when a decision is made.

Salvage Value

An approximation of an asset's value at the conclusion of its effective lifespan.

Erosion Cost

The gradual loss of asset value due to factors like wear, tear, and technological obsolescence, affecting long-term profitability.