Assume that a RB Tire Store completed the following perpetual inventory transactions for a line of tires.

Requirements 1. Compute cost of goods sold and gross profit under FIFO.
2. Compute cost of goods sold and gross profit using LIFO.
3. Compute cost of goods sold and gross profit using average cost. Round aver¬ age cost per unit to the nearest cent and all other amounts to the nearest dollar.
4. Which method results in the largest gross profit and why?

Transcribed Image Text:

Beginning Inventory. Purchase. Sale. 32 tires @ $ 73 37 tires @ $ 67 38 tires @ $154