Purchases of a cer tain product during July were:

July 1 100 units @ £10.00 12 100 units @ £9.80 15 50 units @ £9.60 20 100 units @ £9.40 Units sold during the month were:

July 10 80 units 14 100 units 30 90 units Required:

Assuming no opening inventories:

(i) Determine the cost of goods sold for July under three different valuation methods.

(ii) Discuss the advantages and/or disadvantages of each of these methods.

(iii) A physical inventory count revealed a shortage of five units. Show how you would bring this into account.