Reeble Company Inc. had a beginning inventory of 200 units of Product MLN at a cost of $8 per unit. During the year, purchases were:

Feb. 20 700 units at $ 9

May 5 500 units at $10

Aug. 12 400 units at $11

Dec. 8 100 units at $12

Reeble Company uses a periodic inventory system. Sales totaled 1,400 units.

Instructions

(a) Determine the cost of goods available for sale.

(b) Determine the ending inventory and the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average cost). Prove the accuracy of the cost of goods sold under the FIFO and LIFO methods.

(c) Which cost flow method results in the lowest inventory amount for the balance sheet? The lowest cost of goods sold for the income statement?