Nadal Athletic uses a periodic inventory system and has the following transaction related to its inventory for the month of August 2015:

Required:
1. Calculate ending inventory and cost of goods sold at August 31, 2015, using the specific identification method. The August 4 sale consists of units from beginning inventory, the August 13 sale consists of units from the August 11 purchase, and the August 26 sale consists of two units from beginning inventory and eights units from the August 20 purchase.
2. Using FIFO, calculate ending inventory and cost of goods sold at August 31, 2015.
3. Using LIFO, calculate ending inventory and cost of goods sold at August 31, 2015.
4. Using weighted-average cost, calculate ending inventory and cost of goods sold at August 31, 2015.
5. Calculate sales revenue and gross profit under each of the four methods.
6. Comparing FIFO and LIFO, which one provides the more meaningful measure of ending inventory? Explain.
7. If Pete€™s chooses to report inventory using LIFO, record the LIFOadjustment.

Transcribed Image Text:

Date Transactions Units Cost per Unit August ing inventory August 4 Sle (S150 each) Augus Purchase August 13 l (S160 each) August 20 Purchase August 26 Sale (S170 each) August 29 Purchase $130 120 110 100 Total Cost S 910 1,080 1,320 1,200 12 10 12 S4,510