Assume Fisher Tire, Inc., completed the following perpetual inventory transactions for a line of tires. Beginning Inventory..............................................................................38
Question:
Assume Fisher Tire, Inc., completed the following perpetual inventory transactions for a line of tires.
Beginning Inventory..............................................................................38 tires @ $130
Purchase.................................................................................................16 tires @ $135
Sale..........................................................................................................43 tires @ $224
Requirements
1. Compute cost of goods sold and gross profit using FIFO.
2. Compute cost of goods sold and gross profit using LIFO.
3. Compute cost of goods sold and gross profit using average cost. Round the average cost per unit to the nearest cent and all other amounts to the nearest dollar.
4. Which method results in the largest gross profit? Why?
Step by Step Answer:
Req 1 FIFO Sales Revenue 43x 224 9632 Cost of Goods Sold 38x 130 5x 135 5615 Gross Profit 40...View the full answer
