FIFO and Perpetual Inventory Costing

Having a pretty tough time with FIFO/LIFO and Inventory Costing.

Can someone explain this answer? I’m having a tough time understanding where the (2 x 18) from. I get the 18 x 20 from Q3, but need some clarification on where the 2 x 18 part is coming from. 24 units sold in Q3 but only 20 are accounted for in the solution. Am I missing something?

Thanks in advance.

Question 3 L1FR-PQ2925-1410 Quarter** Units Held/Purchased****Unit Cost ()****Total Cost () Opening Inventory 15 24 360 1 25 15 375 2 22 18 396 3 18 20 360 4 20 22 440 Total 100 1,931**

Given that Magna sold 12, 24, 24, and 26 units in the four quarters respectively, answer the following questions:

Given that the company uses FIFO, ending inventory for the third quarter under the perpetual system is closest to:

$435 $456 $396 Ending inventory = (2 × 18) + (18 × 20) = $396

  1. Open: 15 Units x $24=$360
  2. Sold: 12 Units (Q1)
  3. End: 3 Units @ $24
  4. Open: 3 Units x $24=$72 & 25 Units x $15=$375
  5. Sold: 24 Units (Q2) (3 Units at $24 & 21 units at $15)
  6. End: 4 Units @ $15
  7. Open: 4 Units x $15= $60 & 22 Units @ $18= $396
  8. Sold: 24 Units (Q3) (4 Units @ $15 & 20 Units @ $18)
  9. End: 2 Units @ $18 & 18 Units @ $20= $396

Another way to look at it is by simply counting backwards.

  1. Total Units Sold= Q1+Q2+Q3= 12+24+24=60 Units
  2. Total Units on Hand=Open+Q1+Q2+Q3=15+25+22+18=80 Units
  3. Total Units on Hand-Total Units Sold= 80-60=20
  4. Q3 Inv= 18 Units @ $20 & Q2 Inv= 2 Units @ $18
  5. 18x20+2x18= $396