ABC Ltd is a start-up, wholesaler with a mark-up of 50%.

ABC Ltd had the following transactions for the year 2021:

January 21 purchased 2000 units of inventory at $100 each

February 20 purchased 1500 units of inventory at $120 each

March 10 purchased 1700 units of inventory at $115 each

April 23 purchased 1900 units of inventory at $119 each

May 15 purchased 1900 units of inventory at $128 each

June 29 purchased 2300 units of inventory at $114 each

At the end of each month physical count of inventories showed constant level of inventories of 100 units for the 1st quarter and `150 units for the 2nd quarter. There were no inventories at January 1 2021. ABC Ltd applied WACO for 2021 and decided to change it for FIFO in 2022.

ABC Ltd had the following transactions for the year 2022:

January 31 purchased 5000 units of inventory at $130 each

June 30 purchased 7500 units of inventory at $135 each

September 1 purchased 2000 units of inventory at $130 each

ABC Ltd sold 1000 units each month (inventory system was unchanged).

Required: Show relevant extracts from financial statements for 2021 and 2022.

waco and fifo inventory