Pizza Place’s records include the following accounts with regards to purchases of plastic glasses as at 31 December of the current year:

By 31 December the company sold 10,100 units for £154,876.
Required 

1 Prepare a partial income statement though gross profit under the weighted-average, FIFO and LIFO methods. Use the periodic inventory system.
2 Which stock valuation method would you use to minimise income tax? Explain why this method causes the income tax to be the lowest.

Transcribed Image Text:

Jan. 1 Opening balance (800 units @ 6.99) 5,592 9 Purchase 300 units @ 7.05 2,115 Mar. 23 Purchase 1,100 units @7,35 8,085 June 12 Purchase 8,400 units @ 7.50 63,000 Oct. 7 Purchase 500 units @ 8.50 4,250