Amber, one of your old college friends that graduated from ABC university two years ago, started a business buying and selling house products on the internet. Amber has a reliable source for purchasing inventory and a good customer base. Sales in the first year of operations were slow, but Amber has seen a significant increase in sales in the current year, mostly for her hand sanitizer product. Amber heard that you were taking some accounting courses and has reached out to you for help in deciding how to account for her inventory. Amber sent you the following schedule for her hand sanitizer inventory for 2020

a) Prepare a memo for Amber, identifying the advantages and disadvantages of each of the following inventory systems and cost flow assumptions:

- Cost Flow Assumptions: Specific Identification, Weighted-Average, First-In, First-Out (FIFO) and Last-In, First-Out (LIFO)

- Inventory systems: Perpetual and Periodic

Month January 1 April 1 July 1 August 1 August 30 Units Purchased Cost per Unit Units Sold Sales price per unit 1,000 $ 1.90 2,000 2.10 1,500 $ 4.20 5,000 2.35 5,200 4.90