Question

Decorative Steel began August with 55 units of iron inventory that cost $ 35 each. During August, the company completed the following inventory transactions:


Requirements
1. Prepare a perpetual inventory record for the merchandise inventory using the FIFO inventory costing method.
2. Prepare a perpetual inventory record for the merchandise inventory using the LIFO inventory costing method.
3. Prepare a perpetual inventory record for the merchandise inventory using the weighted-average inventory costing method.
4. Determine the company’s cost of goods sold for August using FIFO, LIFO, and weighted-average inventory costing methods.
5. Compute gross profit for August using FIFO, LIFO, and weighted-average inventory costing methods.
6. If the business wanted to maximize gross profit, which method would it­select?


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  • CreatedJanuary 16, 2015
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