Inventory Costing Methods

Tyler Company has the following information related to purchases and sales of one of its inventory items.

Date Description Units Purchased at Cost Units Sold at Retail

Sept. $1$ Beginning inventory $400$ units @ $$12$

$10$ Purchase $600$ units @ $$13$

$20$ Sales $680$ units @ $$22$

$25$ Purchase $1,000$ units at $$15$

Assume Tyler uses a perpetual inventory system.

Required:

Calculate ending inventory and cost of goods sold using the FIFO, LIFO, and average cost methods.

FIFO LIFO Avg Cost

Cost of goods sold $fill in the blank $1$

$8,440$

$fill in the blank $2$

$8,760$

$fill in the blank $3$

$6,000$

Ending inventory $fill in the blank $4$

$19,160$

$fill in the blank $5$

$18,840$

$fill in the blank $6$

$13,700$

$2.$ Which inventory costing method produces the highest amount for net income?

FIFO

$3.$ Which inventory costing method produces the lowest amount for taxes?

LIFO

$4.$ Which inventory costing method produces the highest amount for ending inventory?

FIFO