Exercise 5-20A (Algo) Effect of inventory cost flow on ending inventory balance and gross margin LO 5-6

The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of operations:

Jan. 20	Purchased	330	units	@	$	7	=	$	2,310
Apr. 21	Purchased	150	units	@	$	8	=		1,200
July 25	Purchased	240	units	@	$	10	=		2,400
Sept. 19	Purchased	60	units	@	$	12	=		720

During the year, The Shirt Shop sold 620 T-shirts for $17 each.

Required

1. Compute the amount of ending inventory The Shirt Shop would report on the balance sheet, assuming the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average.
2. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions.

Complete this question by entering your answers in the tabs below. Compute the amount of ending inventory. The Shirt Shop would report on the balance sheet, arsuming the fulsoning cant foe assumptions: (1) FIFO, (2) LFO, and (3) weighted average. (Round intermediate calcubtons to 2 decimat ploces and frui answers to the nearest whole dollar amount.) Complete this question by entering your answers in the tabs below. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions