Montoure Company uses a periodic inventory system. It entered into the following calendar-year purchases and sales transactions.

Date

Activities

Units Acquired at Cost

Units Sold at Retail

Jan.

1

Beginning inventory

750

units

@ $65.00 per unit

Feb.

10

Purchase

475

units

@ $62.00 per unit

Mar.

13

Purchase

275

units

@ $47.00 per unit

Mar.

15

Sales

875

units

@ $95.00 per unit

Aug.

21

Purchase

250

units

@ $70.00 per unit

Sept.

5

Purchase

650

units

@ $66.00 per unit

Sept.

10

Sales

980

units

@ $95.00 per unit

Totals

2,400

units

1,855

units

Required: 1. Compute cost of goods available for sale and the number of units available for sale.

Cost of goods available for sale
Number of units available for sale		units

2. Compute the number of units in ending inventory.

3. Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification. For specific identification units sold consist of 750 units from beginning inventory, 225 from the February 10 purchase, 275 from the March 13 purchase, 125 from the August 21 purchase, and 480 from the September 5 purchase. (Round your average cost per unit to 2 decimal places. Round your final answers to the nearest whole dollar amount.) Sales

Less COGS

GP

FOR EACH!

5. The companys manager earns a bonus based on a percent of gross profit. Which method of inventory costing produces the highest bonus for the manager?

• LIFO

• Weighted Average

• FIFO

• Specific Identification