Exercise 5-18 Sustainability and perpetual inventory costing LO P1

Tree Seedlings has the following current-year purchases and sales for its only product.

Date			Activities		Units Acquired at Cost							Units Sold at Retail
	Jan.	1		Beginning inventory		120	units	@ $2	=	$	240
	Jan.	3		Sales									94	units	@ $8
	Feb.	14		Purchase		174	units	@ $3	=	$	522
	Feb.	15		Sales									140	units	@ $8
	June	30		Purchase		170	units	@ $4	=	$	680
	Nov.	6		Sales									134	units	@ $8
	Nov.	19		Purchase		52	units	@ $5	=	$	260
				Totals		516	units			$	1,702		368	units

Required: The company uses a perpetual inventory system. a. Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. b. Determine the costs assigned to ending inventory and to cost of goods sold using LIFO. c. Compute the gross margin for each method.