1. A retail company uses perpetual inventory system: Beginning inventory 5,000 units at $10/unit, purchases 10,000 units at $12/unit, ending inventory 8,000 units.
   • Requirements:
     • Calculate the cost of goods sold (COGS) using FIFO and weighted average cost methods.
     • Determine the value of ending inventory using FIFO and weighted average cost methods.
     • Compare the results of COGS and ending inventory valuation under both methods.
     • Recommend the most suitable inventory costing method for the retail company.
     • Discuss the financial reporting implications of inventory valuation methods on profitability and tax liabilities.