Using the information contained in Exercise 10.3, calculate the value of the year-end inventories using FIFO and LIFO. Also, prepare profit and loss accounts showing the gross profit under each of the valuation methods for all three years.

Data from in Exercise 10.3

Marcus Co. has been in operation for three years. The purchases and sales information in Table 10.10 represents the company’s activities for these three years.

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Table 10.10 Sale/purchase transactions for Marcus Co. 20X1 20X2 20X3 Sales (unit) 12,000 @ 50 20,000 @ 60 18,000 @ 65 Purchases (units) 4,000 @ 20 8,000 @ 35 7,000 @ 40 7,000 @ 20 4,000 @ 30 5,000 @ 35 8,000 @ 30 1,000 @ 40 8,000 @ 25