Whitewater Sports Ltd. began July 2020 with 50 backpacks that cost \(\$ 19\) each. The sale price of each backpack was \(\$ 36\). During July, Whitewater completed these inventory transactions:

{Requirements}
1. Determine the store's cost of goods sold, gross profit, and ending inventory using

(a) FIFO and

(b) weighted-average assuming the perpetual system is used.
2. How would your answer change under

(a) FIFO and

(b) weighted-average cost if the periodic system was used?
3. Using the facts provided, identify the information that is relevent in determining which inventory system to use to keep track of the store's inventory. Specify how each information item is relevant to your decision.

Transcribed Image Text:

Units Unit Cost Unit Sale Price July 2 13 283 Purchase.. 12 $20 Sale 37 $36 Sale 13 36 Sale 37 12 17 Purchase. 24 20 20 22 Sale........ 15 37