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Courtney Company uses a periodic inventory system. Data for 2020 are as follows: beginning merchandise inventory (December 31, 2019), 3,750 units at $36.50; purchases, 13,500
Courtney Company uses a periodic inventory system. Data for 2020 are as follows: beginning merchandise inventory (December 31, 2019), 3,750 units at $36.50; purchases, 13,500 units at $41.10; operating expenses (excluding income taxes), $220,500; ending inventory per physical count at December 31, 2020, 3,800 units; sales price per unit, $71.50; and average income tax rate, 30 percent. Required: 1. Prepare statements of earnings under the FIFO and weighted-average costing methods. (Round intermediate calculations to 2 decimal places and final answers to the nearest whole dollar.) Statement of Earnings (Partial) Inventory Costing Method Units FIFO Weighted Average Sales revenue 0 0 0 Cost of sales: Beginning inventory Purchases Cost of goods available for sale Ending inventory Cost of sales Gross profit Expenses (operating) Pretax earings Income tax expense Net earnings 0 0 0 0 0 0 0 $ 0 $ 0 2-a. Which method, FIFO or weighted average cost, is preferable in terms of net earnings? O FIFO Weighted-average cost 2-b. Which method, FIFO or weighted average cost, is preferable in terms of cash flow? O FIFO Weighted-average cost
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