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(FIFO and LIFOPeriodic and Perpetual) Inventory information for Part 311 of Monique Aaron Corp. discloses the following information for the month of June. June 1
(FIFO and LIFOPeriodic and Perpetual) Inventory information for Part 311 of Monique Aaron Corp. discloses the following information for the month of June.
June | 1 | Balance | 300 units @ $10 | June | 10 | Sold | 200 units @ $24 | |||||||
11 | Purchased | 800 units @ $12 | 15 | Sold | 500 units @ $25 | |||||||||
20 | Purchased | 500 units @ $13 | 27 | Sold | 300 units @ $27 |
Instructions
- Assuming that the periodic inventory method is used, compute the cost of goods sold and ending inventory under (1) LIFO and (2) FIFO.
- Assuming that the perpetual inventory method is used and costs are computed at the time of each withdrawal, what is the value of the ending inventory at LIFO?
- Assuming that the perpetual inventory method is used and costs are computed at the time of each withdrawal, what is the gross profit if the inventory is valued at FIFO?
- Why is it stated that LIFO usually produces a lower gross profit than FIFO?
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