Question: Use the data provided in P 2, but assume that the company uses the perpetual inventory system. Required 1. Determine the cost of ending inventory
Use the data provided in P 2, but assume that the company uses the perpetual inventory system.
Required
1. Determine the cost of ending inventory and cost of goods sold for April and May using the average-cost method. Round unit costs to cents and totals to dollars.
2. Determine the cost of ending inventory and cost of goods sold for April and May using the FIFO method.
3. Determine the cost of ending inventory and cost of goods sold for April and May using the LIFO method.
4. Assume that this company grows for many years in a long period of rising prices. How realistic do you think the balance sheet value for inventory would be and what effect would it have on the inventory turnover ratio?
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1 Perpetual inventory systemaveragecost method Date Units Cost Amount Apr 1 Beginning inventory 50 20400 10200 10 Purchase 100 22000 22000 10 Balance 150 21467 32200 17 Sale 90 21467 19320 30 Ending i... View full answer
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