Inventory Costing Methods Anderson's Department Store has the following data for inventory, purchases, and sales of merchandise for December for one of the items the company sells:

Anderson's uses a perpetual inventory system. All purchases and sales were for cash.
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1. Compute cost of goods sold and the cost of ending inventory using FIFO.
2. Compute cost of goods sold and the cost of ending inventory using the weighted average cost method. (Note: Use four decimal places for per-unit calculations and round all other numbers to the nearest penny.)
3. Prepare the journal entries to record these transactions, assuming Anderson's chooses to use the FIFO method.
4. CONCEPTUAL CONNECTION Which method would result in the lowest amount paid for taxes?
Problem

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Purchase Price Sale Price Activity Units (per unit) (per unit) Beginning inventory 10 $6.00 Purchase 1, Dec. 2 22 6.80 Purchase 2, Dec. 5 26 7.50 Sale 1, Dec. 7 19 $12.00 Sale 2, Dec. 10 25 12.00 Purchase 3, Dec. 12 12 8.00 Sale 3, Dec. 14 20 12.00