Problem $3.$ Inventory Cost Flow Assumption: FIFO, LIFO, Average Cost; Periodic & Perpetual Methods

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Inventory information for Moby Corporation disclosed the following information for the $$month of June:

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June$1$ Balance $450$ units @ $$11$ June$15$ Sold $200$ units @ $$2411$ Purchased $950$ units @ $$1315$ Sold $575$ units @ $$2520$ Purchased $525$ units @ $$1427$ Sold $324$ units @ $$27$

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Instructions

$3\mathrm{.}1$ thru $3$ Assuming that the periodic inventory method is used, compute the cost of goods sold and ending inventory under $(1)$ LIFO, $(2)$ FIFO, $(3)$ Average Cost.

$3\mathrm{.}4$ thru $6$ Assuming that the perpetual inventory method is used and costs are computed at the time of each withdrawal, what is the cost of goods sold and ending inventory under $(4)$ LIFO, $(5)$ FIFO, $(6)$ Average Cost.

$3\mathrm{.}7$ Prepare the adjusting journal entries to record cost of goods sold for the month of June for the perpetual inventory method only.

$3\mathrm{.}8$ Explain why LIFO usually produces a lower gross profit than the FIFO method.