Deala Ltd. ("DL") is a retailer of office equipment. The company uses a periodic inventory system and began October with 2,000 units with a total cost of $40,000. During the month of October, DL had the following inventory-related transactions:

Instructions
(a) Determine the cost of goods available for sale for the month.
(b) Calculate ending inventory at October 31 and cost of goods sold for the month assuming that DL used (1) FIFO and (2) average cost.
(c) Determine which cost formula would result in the higher gross profit for DL.

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Date ExplanationUnits Unit Cost Total Cost 50,000 21.00 $105.000 ,000 20.5082,000 Oct. 9 Purchase 12 Purchase 17 Sale (@ $40/unit) (5,000) 25 Purchase 28 Sale (@ $40/unit) (6,000) 4,00020.8083,200