The following information is available concerning the inventory of Carter Inc.:

During the year, Carter sold 1,000 units. It uses a periodic inventory system.

Required
1. Calculate ending inventory and cost of goods sold for each of the following three methods:
a. Weighted average
b. FIFO
c. LIFO
2. Assume an estimated tax rate of 30%. How much more or less (indicate which) will Carter pay in taxes by using FIFO instead of LIFO? Explain your answer.
3. Assume that Carter prepares its financieal statements in accordance with IFRS. Which costing method should it use to pay the least amount of taxes? Explain youranswer.

Transcribed Image Text:

Units Unit Cost 200 $10 Beginning inventory Purchases March 5 June 12 August 23 October 2 300 400 250 150 12 13 15