Computing Cost of Sales and Ending Inventory Stocken Company has the following financial records for the current period:

		Units	Unit cost
Beginning inventory		100	$48
Purchases	#1	650	44
	#2	550	40
	#3	200	38

Ending inventory at the end of this period is 350 units. Compute the ending inventory and the cost of goods sold for the current period using (a) first-in, first-out, (b) average cost, and (c) last-in, first-out.

		FIFO	Average cost	LIFO
Cost of goods sold		Answer	Answer	Answer
Ending inventory		Answer	Answer	Answer

Determining Lower of Cost or Net Realizable Value (NRV)

Crane Company had the following inventory at December 31, 2017.

	Unit Price
	Quantity	Cost	NRV
Desks
Model 9001	71	$190	$210
Model 9002	46	280	268
Model 9003	21	350	360
Cabinets
Model 7001	121	60	64
Model 7002	81	95	88
Model 7003	51	130	126

a. Determine the ending inventory amount by applying the net realizable value rule to: 1. Each item of inventory. $Answer 2. Each major category of inventory. $Answer 3. Total inventory. $Answer

Analyzing Inventory Footnote Disclosure General Motors Corporation reported the following information in its 10 -K report:

Inventories at December 31 ($ millions)				2008	2007
Productive material, work in process, and supplies				$5,077	$6,495
Finished product, service parts, etc.				9,654	10,323
Total inventories at FIFO				14,731	16,818
Less LIFO allowance				(1,261)	(1,451)
Total automotive and other inventories, less allowances				$13,470	$15,367

The company reports its inventory using the LIFO costing method during 2007 and 2008.

a. At what dollar amount are inventories reported on its 2008 balance sheet? $Answer million

b. At what dollar amount would inventories have been reported in 2008 if FIFO inventory costing had been used? $Answer million

c. What cumulative effect has the use of LIFO had, as of year-end 2008, on GM's pretax income, compared to the pretax income that would have been reported using the FIFO costing method? Pretax income has Answerdecreasedincreased by $Answer million cumulatively since GM adopted LIFO inventory costing.

d. Assuming a 35 % income tax rate, what is the cumulative effect on GM's tax liability as of year-end 2008 ? (Round answer to one decimal place.) Cumulative taxes have Answerdecreasedincreased by $Answer million by the use of LIFO costing.

Calculating Gross Profit Margin and Inventory Turnover The following table presents sales revenue, cost of goods sold, and inventory amounts for three retailers of fine jewelry, Tiffany & Co., Zale Corporation, and Blue Nile, Inc. (an Internet retailer).

($ millions)	2013	2012
Tiffany & Co.
Revenues	$4,131	$3,879
Cost of goods sold	1,741	1,666
Inventory	2,427	2,334
Zale Corporation
Revenues	$1,938	$1,902
Cost of goods sold	954	941
Inventory	793	757
Blue Nile, Inc.
Revenues	$475	$435
Cost of goods sold	416	360
Inventory	60	48

a. Compute the gross profit margin (GPM) for each of these companies for 2013 and 2012. Note: Round GPM answers to one decimal place (ex: 0.2345 = 23.5%).

	Tiffany				Zale				Blue Nile
	2013		2012		2013		2012		2013		2012
Gross profit	Answer		Answer		Answer		Answer		Answer		Answer
Gross profit margin (GPM)	Answer	%	Answer	%	Answer	%	Answer	%	Answer	%	Answer	%

b. Compute the inventory turnover ratio and the average inventory days outstanding for 2013 for each company.

Do not round until your final answer.

Round inventory turnover to one decimal place. Round average inventory days outstanding to nearest whole number.

	Tiffany	Zale	Blue Nile
Inventory turnover	Answer	Answer	Answer
Avg. inventory days outstanding	Answer	Answer	Answer