The following data relates to the inventory and purchases of item 125 for McCray Company during May:

INSTRUCTIONS
Determine the cost of the ending inventory on May 31 under each of the following methods: 

(a) Average cost method; 

(b) First-in, first-out (FIFO) method; 

(c) Last-in, first-out (LIFO) method. 

When using the average cost method, compute the unit cost to two decimal places.

Analyze: Which inventory amount will result in the highest income for the period?

Transcribed Image Text:

Inventory, May 1 Purchases: May 10 May 19 May 25 Inventory, May 31 260 units at $21.00 190 units at $20.75 140 units at $20.35 160 units at $20.40 230 units