Cost flow methods The following three identical units of Item P401C are purchased during April: Item Beta Units Cost $237 241 Apr. 2 Apr. 15 Apr. 20 Total a. First-in, first-out (FIFO) b. Last-in, first-out (LIFO) c. Weighted average cost Feedback Gross Profit 91 89 X Purchase Purchase Purchase Average cost per unit ($723 = 3 units) Assume that one unit is sold on April 27 for $328. Determine the gross profit for April and ending inventory on April 30 using the (a) first-in, first-out (FIFO); (b) last-in, first-out (LIFO); and (c) weighted average cost method. 83 X 1 1 1 3 $723 $241 245 Ending Inventory 419 X 417 X 411 X Check My Work a. Sales - cost of goods sold = gross profit. FIFO means that the first units purchased are assumed to be the first to be sold. Therefore, ending inventory is made up of the m b. Sales - cost of goods sold = gross profit. LIFO means the last units purchased are assumed to be the first to be sold. Therefore, ending inventory is made up of the first pu c. Sales - cost of goods sold = gross profit. Average cost means the average cost of all available units purchased is applied to the number of units sold and in ending inventor

Cost Hew methods The folowing three ifentical units of Item P401C are purchased during Agrit: Assume that one unit is sold on April 27 for 5328 . Determine the gross proft for Apnt and ending irventory on Aprif 30 using the (a) hint irc first-out (F)F); (b) last-in, first-out (uro); and (c) weighted average cast inethod. a. Sales - cost of goods sold - gross profit rHo means that the nrst units purchased are arsumed to be the first to be solf Therifore, ending anyentory is insde up if the b. Sales - cont of goods sald = gross profit, Hro means the last unta purchased are assumed to be the first to be sold, Theirtere, ending inventory is made up of the first c. Saies - cost of goods sold = gross profit. Average cost means the everage cost of all avalable units purchosed so bolind to the nuinter of uivts sold and in ending ivert