Activity 12 49 Inventory Decisions: Chocolates Anyone? "If I see another chocolate bar, think I'll As the new treasurer and head of ways and means for Phi Slamma Jamma, you are in the midst of the club's annual chocolate fund raiser. "Why we keep trying to sell chocolates after last year's fiasco, I'll never know." When you took over as treasurer, you inherited a large supply of inventory as well as an order in process for more. Sales have been slow, but the club members look a little rounder," so you suspect the sales force may be eating what it can't sell You just received a notice from the university requesting a report from the club on the status of its fund-raiser, including total funds collected, total costs of chocolate bars sold and total costs of bars unsold. Based on your recent accounting class, you know there are some decisions to be made, which can affect your report. You've made a list of some key questions to discuss with the professor before you prepare the report to the university. Then you plan to prepare a short presentation to your club, explaining the report and the decisions you made as treasurer NAME: Inventory Decisions: Chocolates, Anyone? Information Summary: Chocolate bars purchased 5/12/95: 500 bars costing $200 Chocolate bars purchased 9/28/95: 500 bars costing $300 Sales of candy totaling $750. (Each bar sells for $1.25) Candy bars remaining to be sold: 350 bars. Questions to Be Resolved: . How should I report the "missing" candy bars? Disadvantages? 2. What are the advantages to the club of using FIFO? 3. What are the advantages to using LIFO? Disadvantages? 4. Will one method increase or decrease the amount of funds we raise