Exercise 5-18 Sustainability and perpetual inventory costing LO P1 Tree Seedlings has the following current-year purchases and sales for its only product. Units Sold at Retail Units Acquired at Cost 180 units @ $2 = $ 360 118 units @ $8 282 units @ $3 = 846 Date Activities Jan. 1 Beginning inventory Jan. 3 Sales Feb.14 Purchase Feb. 15 Sales June 30 Purchase Nov. 6 Sales Nov.19 Purchase 200 units @ $8 230 units @ $4 = $ 920 170 units @ $8 76 units @ $5 768 units = $ 380 $2,506 Totals 488 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. Perpetual FIFO: Goods Purchased Cost of Goods Sold Cost per Inventory Balance Cost per Inventory # of units unit Balance Date # of units Cost per unit # of units sold Cost of Goods Sold unit January 1 180 @ $ 2.00 = $ 360.00 January 3 February 14 February 15 June 30 November 6 November 6 November 19 Totals $ 0.00 Perpetual LIFO: Goods Purchased # of Cost per units unit Cost of Goods Sold # of units Cost of Goods sold unit Sold Cost per Cost per Date Inventory Balance Inventory # of units unit Balance 180 $ 2.00 $ 360.00 January 1 January 3 February 14 February 15 June 30 November 6 November 6 November 19 Totals 0.00 Compute the gross margin for each method. FIFO: LIFO: Sales revenue Cost of goods sold Gross margin $ 0 $ 0