1a.

During 2021, a company sells 270 units of inventory for $94 each. The company has the following inventory purchase transactions for 2021:

Date		Transaction	Number of Units			Unit Cost			Total Cost
Jan.	1	Beginning inventory		65		$	67			$	4,355
May	5	Purchase		164			68				11,152
Nov.	3	Purchase		186			70				13,020
				415						$	28,527

Calculate ending inventory and cost of goods sold for 2021 assuming the company uses FIFO.

1b. A company overstated its ending inventory balance by $4,000 in 2021. What impact will this error have on cost of goods sold and gross profit in 2021 and 2022?