1. Lambda Retail

Scenario: Inventory Valuation

Data: Lambda Retail uses the FIFO method for inventory valuation. The following data is available for the year:

• Beginning Inventory: 1,000 units at $10 per unit
• Purchases:
  • January: 2,000 units at $12 per unit
  • April: 1,500 units at $15 per unit

• Sales:
  • February: 3,000 units
  • May: 2,500 units

• Ending Inventory: 2,000 units

Requirements:

1. Calculate Lambda Retail's cost of goods sold (COGS) using the FIFO method.
2. Determine the value of ending inventory using the FIFO method.
3. Analyze the impact of inventory costing methods on Lambda Retail's financial statements and profitability.