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Alta Ski Company's inventory records contained the following information regarding its latest ski model. The company uses a periodic inventory system. 600 units @ $80 each 1,000 units @ $95 each 800 units @ $100 each Beginning inventory, January 1, 2021 Purchases: January 15 January 21 Sales: January 5 January 22 January 29 Ending inventory, January 31, 2021 400 units @ $120 each 800 units @ $130 each 400 units @ $135 each 800 units Required: 1a. Which method, FIFO or LIFO, will result in the highest cost of goods sold figure for January 2021? 1b. Which method will result in the highest ending inventory balance? 2. Compute cost of goods sold for January and the ending inventory using both the FIFO and LIFO methods. 3a. Assume that inventory costs were declining during January. The inventory purchased on January 15 had a unit cost of $70, and the inventory purchased on January 21 had a unit cost of $65. All other information is the same. Which method, FIFO or LIFO, will result in the highest cost of goods sold figure for January 2021? 3b. Which method will result in the highest ending inventory balance? 3c. Compute cost of goods sold for January and the ending inventory using both the FIFO and LIFO methods. Compute cost of goods sold for January and the ending inventory using both the FIFO and LIFO methods. Req 1A and 1B Req 2 Req 3A and 3B Req 30 Which method, FIFO or LIFO, will result in the highest cost of goods sold figure for January 2021 and highest ending inventory balance? 1a. Highest cost of goods sold figure 1b. Highest ending inventory balance Req 1A and 1B Req 2 > Req 1A and 1B: Reg 2 Req 3A and 3B Req 3C Compute cost of goods sold for January and the ending inventory using both the FIFO and LIFO methods. Cost of Goods Available for Sale Cost of Goods Sold - Periodic FIFO FIFO Cost of Goods # of units Cost per Available for Cost per Cost per # of units Ending Inventory - Periodic FIFO # of units Ending in ending unit inventory Inventory $ 80 unit sold Cost of Goods Sold unit Sale 600 $ 80 $ 48,000 $ 80 Beginning Inventory Purchases: January 15 January 21 Total 1,000 $ 95 95,000 $ 95 $ 95 800 $ 100 80,000 $ 100 $ 100 2,400 $ 223,000 Cost of Goods Sold - Periodic LIFO LIFO Cost of Goods Available for Sale Cost of Goods Cost per # of units Available for unit Sale 600 $ 80 $ 48.000 # of units sold Cost per unit Cost of Goods Sold Ending Inventory - Periodic LIFO # of units Cost per Ending in ending unit Inventory inventory $ 80 $ 80 Beginning Inventory Purchases: January 15 January 21 Total 1,000 $ 95 95.000 $ 95 $ 95 800 $ 100 80,000 $ 100 $ 100 2,400 $ 223,000 Compute cost of goods sold for January and the ending inventory using both the FIFO and LIFO methods. Req 1A and 1B Reg 2 Req 3A and 3B Req 3C Assume that inventory costs were declining during January. Which method, FIFO or LIFO, will result in the highest cost of goods sold figure for January 2021 and highest ending inventory balance? . Highest cost of goods sold figure Highest ending inventory balance 3b.
