The Short Cut Lawn Mower Store sells one type of lawn mower at a price of \(\$ 200\) per unit. On 1 June, it had an \(\$ 800\) accounts receivable balance and a \(\$ 600\) accounts payable balance, as well as an inventory of ten mowers costing \(\$ 120\) each. During June, its purchases and sales of mowers were:

All purchases and sales were on credit. No payments or collections were made during June. The business has a perpetual inventory system and uses bar codes to verify each sale, which allows the specific identification method of inventory valuation to be used. For the 15 June sales, eight were mowers from the beginning inventory, and three were mowers purchased on 8 June. For the 30 June sales, two were mowers from the beginning inventory, five were mowers purchased on 21 June, and one was a mower purchased on 26 June.
Required:
a Assume that the business uses Specific Identification method and counted its inventory at the close of business on 30 June to determine that it had eight mowers in stock. Calculate the ending balance in the Inventory account and the cost of goods sold.
b Following on from a above, record the beginning balances in the Accounts Receivable, Inventory and Accounts Payable accounts. Using account columns, record the purchases and sales transactions during June and calculate the ending balances of all the accounts you used.
c Assume that the business uses FIFO (first-in, first-out) and counted its inventory at the close of business on 30 June and determined that it had eight mowers in stock. Calculate the ending balance in the Inventory account and the cost of goods sold.
d Use the same information as for

(c) above, but assume that the business uses LIFO (last-in, first-out) to calculate the ending balance in the inventory account and the cost of goods sold.
e Use the same information as

(c) above, but assume that the business uses weighted average to calculate the ending balance in the inventory account and the cost of goods sold.
f Calculate the business' gross profit percentage for June using the Specific Identification method. How does this compare with its gross profit percentage of 40.8 per cent for May? What might account for the difference?

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8 June 15 21 26 30 Purchases 7 mowers @ $125 each 6 mowers @ $121 each 4 mowers @ $124 each. Sales 11 mowers 8 mowers