Applying and Analyzing Inventory Costing Methods At the beginning of the current period, Chen carried 1,000 units of its product with a unit cost of $10. A summary of purchases during the current period follows. During the period, Chen sold 2,800 units, Units Unit Cost Cost 1,000 $ 10 11 1,800 $10,000 19,800 13 10,400 800 1,200 15 18,000 Beginning Inventory Purchase #1 Purchase #2 Purchase #3 (a) Assume that Chen uses the first-in, first-out method, Compute both cost of good sold for the current period and the ending inventory balance. Use the financial statement effects template to record cost of goods sold for the period. Ending inventory balance $ 28,400 Cost of goods sold Use negative signs with answers, when appropriate. $ 29,800 Transaction Record FIFO cost of goods sold Cash Asset + $0 Noncash Assets (29,800) X Balance Sheet Liabilities 0 Contributed Capital 0 Earned Capital (29,800) Revenue 0 Income Statement (b) Assume that Chen uses the last-in, first-out method. Compute both cost of good sold for the current period and the ending inventory balance. Ending inventory balance $ 132,800 X Cost of goods sold Expenses - 29,800 Net Income (29,800) (c) Assume that Chen uses the average cost method. Compute both cost of good sold for the current period and the ending inventory balance. (HINT: Do not round average cost per unit for calculations.) Ending inventory balance $0 X

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