Chapter 5 Homework eBook Comparison of Inventory Costing Methods-Periodic System Bitten Company's inventory records show 607 units on hand on October 1 with a unit cost of $5 each. The following transactions occurred during the month of October: Date Unit Purchases Unit Sales October 4 504 $12.00 October 8 805 $5.32 October 9 705 $12.00 October 18 693 $5.78 807 $13.00 804 $5.91 October 20 October 29 All expenses other than cost of goods sold amount to $2,999 for the month. The company uses an estimated tax rate of 30% to accrue monthly income taxes. Required: 1. Prepare a chart comparing cost of goods sold and ending inventory using the periodic system and the following costing methods. In your calculations round weighted average unit cost to three decimal places and round all other calculations and your final answers to the nearest dollar. Bitten Company Comparison for Cost of Goods Sold and Ending Inventory Using the Periodic System For Weighted Average, FIFO and LIFO Cost Methods Inventory System Cost of Goods Sold Ending Inventory Total Weighted average $11,157 X FIFO LIFO Foodbook $4,918 X 16,075 10,826 X 5,249 X 16,075 11,529 X 4,546 X 16,075 Check My Work Review the differences in inventory costing methods using the periodic system. The first step in any of the methods should be to calculate the cost of the inventory on hand and purchased. How would you determine the number of units of inventory still on hand at the end of the month? 2. What does the Total column represent? Cost of goods available for sale Feedback Check My Work Was your total column the same for all three methods? 3. Prepare income statements for each of the three methods. When required, round your answers to the nearest dollar. Bitten Company Income Statement For the Month of October Weighted Average Sales 24,999 FIFO 24,999 LIFO Cost of goods sold 11,157 X 10,826 x 24,999 11,529 X Gross profit 13,842 X Operating expenses 2,999 14,173 X 2,999 13,470 X 2,999 Income before taxes $ 10,843 X 11,174 X $ 10,471 X Income tax expense 3,255 X 3,152 X 3,141 X Net income 7,590 X 7,822 X $ 7,330 X Check My Work 2 more Check My Work uses remaining.