Assume that Models and More store bought and sold a line of dolls during December as follows:

Requirements
1. Compute the cost of cost of goods sold, cost of ending merchandise inventory, and gross profit using the FIFO inventory costing method.
2. Compute the cost of cost of goods sold, cost of ending merchandise inventory, and gross profit using the LIFO inventory costing method.
3. Which method results in a higher cost of goods sold?
4. Which method results in a higher cost of ending merchandise inventory?
5. Which method results in a higher grossprofit?

Transcribed Image Text:

Dec. 1 Beginning merchandise inventory 13 units 311 each 9 units $20 each 17 units $13 each 13 units $20 each 8 Sale 14 Purchase 21 Sale