Determine company cost of goods sold expense

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Reference no: EM13534423

Suppose that Company X uses the FIFO method instead of the LIFO method shown in table. The company starts the year with 25,000 units in beginning inventory at a cost of $735 per unit according to the FIFO method. During the year, it manufactures 120,000 units and sells 110,000 units. Determine Company X's cost of goods sold expense for the year and its cost of ending inventory using the FIFO method.

 

Company X

 
 

Per Unit

Totals

Operating Profit Report for Year

   

Sales volume, in Units

 

110,000

Sales Revenue

$1,400.00

$154,000,000

Cost of Goods Sold Expense (see below)

-760

-83,600,000

Gross Margin

$640.00

$70,400,000

Variable Operating Expenses

-300

-33,000,000

Contribution Margin

$340.00

$37,400,000

Fixed Operating Expenses

 

-21,450,000

Operating Profit

 

$15,950,000

Manufacturing Activity Summary for Year

Per Unit

Totals

Annual Production Capacity, in Units

 

150,000

Actual Output, in Units

 

120,000

Raw Materials

$215.00

$25,800,000

Direct Labor

125

15,000,000

Variable Manufacturing Overhead Costs

70

8,400,000

Total Variable Manufacturing Costs

$410.00

$49,200,000

Fixed Manufacturing Overhead Costs

350

42,000,000

Product Cost and Total Manufacturing Costs

$760.00

$91,200,000

Reference no: EM13534423

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