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5-1A Perpetual: Alternative cost flows LO P1 [The following information applies to the questions displayed below.] Warnerwoods Company uses a perpetual inventory system. It entered

5-1A Perpetual: Alternative cost flows LO P1

[The following information applies to the questions displayed below.] Warnerwoods Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March.

Date Activities Units Acquired at Cost Units Sold at Retail
Mar. 1 Beginning inventory 210 units @ $53.20 per unit
Mar. 5 Purchase 280 units @ $58.20 per unit
Mar. 9 Sales 370 units @ $88.20 per unit
Mar. 18 Purchase 140 units @ $63.20 per unit
Mar. 25 Purchase 260 units @ $65.20 per unit
Mar. 29 Sales 240 units @ $98.20 per unit
Totals 890 units 610 units

Problem 5-1A Part 3

1. Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification. For specific identification, the March 9 sale consisted of 120 units from beginning inventory and 250 units from the March 5 purchase; the March 29 sale consisted of 100 units from the March 18 purchase and 140 units from the March 25 purchase.

4. Compute gross profit earned by the company for each of the four costing methods. For specific identification, the March 9 sale consisted of 120 units from beginning inventory and 250 units from the March 5 purchase; the March 29 sale consisted of 100 units from the March 18 purchase and 140 units from the March 25 purchase

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