Perpetual Inventory Using FIFO Beginning inventory, purchases, and sales data for portable DVD players are as follows: Apr. 1 Inventory 46 units @ $58 10 Sale 32 units 15 Purchase 23 units @ $60 20 Sale 19 units 24 Sale 10 units 30 Purchase 31 units @ $62 The business maintains a perpetual inventory system, costing by the first-in, first-out method. Determine the cost of the merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 3. a. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Merchandise Sold Unit Cost column and in the Inventory Unit Cost column. Cost of the Merchandise Sold Schedule First-in, First-out Method Portable DVD Players Date Quantity Purchased Purchases Unit Cost Purchases Total Cost Quantity Sold Cost of Merchandise Sold Unit Cost Cost of Merchandise Sold Total Cost Inventory Quantity Inventory Unit Cost Inventory Total Cost Apr. 1 46 $ 58 $ 2,668 Apr. 10 32 $ 58 $ 1,856 14 58 812 Apr. 15 23 $ 60 $ 1,380 Apr. 20 60 Apr. 24 10 60 600 60 Apr. 30 60 Apr. 30 Balances $ 4,350 $ b. Based upon the preceding data, would you expect the inventory to be higher or lower using the last-in, first-out method? Lower Feedback Consider the cost of inventory when purchased and when sold. Remember FIFO reports higher gross profit, net income, and ending inventory than the LIFO method when costs (prices) are increasing.