Question

Edwards Company began operations in February 2011. Edwards accounting records provide the following data for the remainder of 2011 for one of the items the company sells:
Edwards uses a periodic inventory system. All purchases and sales were for cash.
Required:
1. Compute cost of goods sold and the cost of ending inventory using FIFO.
2. Compute cost of goods sold and the cost of ending inventory using LIFO.
3. Compute cost of goods sold and the cost of ending inventory using the average cost method.
4. Prepare the journal entries to record these transactions assuming Edwards chooses to use the FIFO method.
5. Which method would result in the lowest amount paid for taxes?
6. If you worked Problem 6-58B, compare your results. What are the differences? Be sure to explain why the differences occurred.


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  • CreatedSeptember 22, 2015
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