E 8-15 Comparison of FIFO and LIFO; periodic system LO8-1, LO8-4 Alta Ski Company's inventory records contained the following information regarding its latest ski model. The company uses a periodic inventory system. Beginning inventory, January 1, 2018 600 units @ $80 each Purchases: January 15 January 21 Sales: January 5 1,000 units @ $95 each 800 units @ $100 each January 22 January 29 Ending inventory, January 31, 2018 Required: 400 units @ $120 each 800 units @ $130 each 400 units @ $135 each 800 units 1. Which method, FIFO or LIFO, will result in the highest cost of goods sold figure for January 2018? Why? Which method will result in the highest ending inventory balance? Why? 2. Compute cost of goods sold for January and the ending inventory using both the FIFO and LIFO methods. Requirement 1 Requirement 2 Computation of cost of goods available for sale: Beginning inventory Cost of goods sold available for sale (2,400 units) First-in, first-out (FIFO) Cost of goods available for sale (2,400 units) Less: Ending inventory (determined below) Cost of goods sold Cost of ending inventory: Date of purchase Units Unit cost Total cost Last-in, first-out (LIFO) Cost of goods available for sale (2,400 units) Less: Ending inventory (determined below) Cost of goods sold Cost of ending inventory: Date of purchase Units Unit cost Total cost