Question: Assume the company uses a periodic inventory system Refer to P10 2 Data

Assume the company uses a periodic inventory system.
Refer to P10.2.
Data from Trail Bikes, Inc.’s perpetual inventory records for a tire it produces and sells follow:
The company sold 53,000 tires during the year at $ 20 each.
A. Compute the cost of the ending inventory and the cost of goods sold using both FIFO and LIFO.
B. In your opinion, which of the two methods is a better representation of the balance sheet value for the inventory? Why?
C. What is the gross margin using each method?
D. Which method do you think is more representative of the firm’s income? Why?

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