1. Compute the amount of ending inventory The Shirt Shop would report on the balance sheet, assuming the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average.
2. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions.
3.  

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The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of operations: Jan. 20 Apr. 21 July 25 Purchased Purchased Purchased Sept. 19 Purchased Required A 330 units 80 units 220 units 70 units During the year, The Shirt Shop sold 530 T-shirts for $15 each. Required a. Compute the amount of ending inventory The Shirt Shop would report on the balance sheet, assuming the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average. b. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions. Required B Gross margin @ @ @ @ Complete this question by entering your answers in the tabs below. $4 $ 6 = $8 = $10 = FIFO $1,320 480 1,760 700 Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions. LIFO Difference The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of operations: Jan. 20 Apr. 21 July 25 Purchased Purchased Purchased Sept. 19 Purchased Required A 330 units 80 units 220 units 70 units During the year, The Shirt Shop sold 530 T-shirts for $15 each. Required a. Compute the amount of ending inventory The Shirt Shop would report on the balance sheet, assuming the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average. b. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions. Required B Gross margin @ @ @ @ Complete this question by entering your answers in the tabs below. $4 $ 6 = $8 = $10 = FIFO $1,320 480 1,760 700 Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions. LIFO Difference

Answer rating: 100% (QA)

Merchandise Inventory a FIFO 1500 b LIFO 680 c Weighted Avg Cost 1035 M... View the full answer