Julia has recently opened a dry fruits

THE NUTHOUSE

Since 2020

wholesale company dedicated to the

sale of peanuts, almonds and pistachios. The

company's name is "The Nuthouse" The Nuthouse

was founded during 2020. Julia's passion, longevity

and wealth of knowledge in the industry led to The

Nuthouse expanding rapidly, creating a network of

partners that spans farming operations in the key

growing territories of South Africa, Australia, Kenya,

Malawi, Zimbabwe, Mozambique and Brazil.

During February, its first month of activity, The

Nuthouse made the following transactions:

QUESTION 2

Prepare an Income statement of the company at the end of February for each one of the products sold by Julia using the following methods of valuation of theinventory: You can ignore all tax consequences.

a. The average cost method

b. FIFO method and

Calculate the balances of the inventory at the end of the month for each valuation method and provide explanations of the calculations.

12:28 1 Over and above these transactions, the company has had the following expenses: The company's accountant recommended that they should use the average cost method in order to determine the cost of the inventory sold but he is not sure about the consequences it may have on their financial situation