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EcoGoods Ltd. uses a periodic inventory system. It entered into the following transactions for August. Date Activities Units Acquired at Cost Units Sold at Retail

EcoGoods Ltd. uses a periodic inventory system. It entered into the following transactions for August.

Date

Activities

Units Acquired at Cost

Units Sold at Retail

Aug. 1

Beginning inventory

220 units @ $65 per unit


Aug. 6

Purchase

460 units @ $70 per unit


Aug. 12

Sales


420 units @ $95 per unit

Aug. 18

Purchase

300 units @ $75 per unit


Aug. 26

Sales


280 units @ $105 per unit

For specific identification, the August 12 sale consisted of 100 units from beginning inventory and 320 units from the August 6 purchase; the August 26 sale consisted of 150 units from the August 18 purchase and 130 units from the August 6 purchase.

Required:

  1. Compute the cost of goods sold and ending inventory using FIFO and LIFO methods.
  2. Determine the weighted average cost per unit and the ending inventory value.
  3. Analyze the financial performance of EcoGoods Ltd. under different inventory costing methods.
  4. Provide a strategic recommendation on the optimal inventory costing method for EcoGoods Ltd., supported by financial analysis and industry trends.

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