The beginning inventory of merchandise at Dunne Co. and data on purchases and sales for a three-month period ending June 30, 2016, are as follows:

Instructions
1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 4, using the first-in, first-out method.
2. Determine the total sales and the total cost of merchandise sold for the period. Journalize the entries in the sales and cost of merchandise sold accounts. Assume that all sales were on account.
3. Determine the gross profit from sales for the period.
4. Determine the ending inventory cost on June 30, 2016.
5. Based upon the preceding data, would you expect the inventory using the last-in, first-out method to be higher or lower?
Exhibit 4: Elements of Internal Control

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Number of Units Per Unit 1,200 1,240 2,000 2,000 1,260 2,000 2,000 1,260 2,250 2,250 1,264 2,250 Total 30,000 93,000 80,000 60,000 75,600 Date Transaction Apr. 3 Inventory 8 Purchase 11 Sale 30 Sale 75 40 30 60 50 20 80 40 May 8 Purchase 10 Sale 19 Sale 28 Purchase 100,800 90,000 56,250 44,240 99,000 June 5 Sale 16 Sale 21 Purchase 28 Sale 35 Control Threats Control Environment Risk Assessment Control Procedures Monitoring Information and Communication Management Business