The Sportex Company a diversified distribution outlet for sporting goods
The Sportex Company, a diversified distribution outlet for sporting goods, purchases cartons of tennis balls from the Ball Corporation and markets the balls under the Sportex name. Purchases and sales data for January 2016, the first month of operations, are provided below:
Sportex uses a perpetual inventory system.
1. Compute the cost of sales in January 2016 by using the FIFO method.
2. Compute the cost of ending inventory at January 31, 2016, assuming that Sportex uses the weighted- average cost method. (Round your calculation of the average cost to the nearest cent.)
3. Would the computations you made in (1) and (2) change if the company used a periodic inventory system? Explain.
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