Suppose a Costco store in Gainesville, Missouri, ended May 2016 with 1,000,000 units of merchandise that cost $8 each. Suppose the store then sold 100,000 units for $850,000 during June. Further, assume the store made two large purchases during June as follows:

Requirements
1. Calculate the store's gross profit under both FIFO and LIFO at June 30.
2. What caused the FIFO and LIFO gross profit figures to differ?

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Jun 5 45,000 units@$6.10 $274,500 25 30,000 units @$5.20$156,000