1. Beta Manufacturing

Scenario: FIFO vs. LIFO Impact

Data:

• Beginning Inventory: 1,000 units at $10 per unit
• Purchases:
  • April 1: 2,000 units at $12 per unit
  • October 1: 3,000 units at $14 per unit

• Sales: 4,000 units during the year

Requirements:

1. Calculate the Cost of Goods Sold using the FIFO method.
2. Calculate the Cost of Goods Sold using the LIFO method.
3. Compare the COGS under FIFO and LIFO.
4. Discuss the tax implications of inventory valuation methods.
5. Evaluate which method (FIFO or LIFO) Beta Manufacturing should use.