Montoure Company uses a perpetual inventory system. It entered into the following calendar-year purchases and sales transactions. Date Activities Units Acquired at Cost Units Sold at Retail January 1 Beginning inventory 680 units @ $40 per unit February 10 Purchase 320 units @ $35 per unit March 13 Purchase 100 units @ $23 per unit March 15 Sales 720 units @ $75 per unit August 21 Purchase 130 units @ $45 per unit September 5 Purchase 490 units @ $41 per unit September 10 Sales 620 units @ $75 per unit Totals 1,720 units 1,340 units Required: 1. Compute cost of goods available for sale and the number of units available for sale. 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 680 units from beginning inventory, 220 from the February 10 purchase, 100 from the March 13 purchase, 80 from the August 21 purchase, and 260 from the September 5 purchase.) 4. Compute gross profit earned by the company for each of the four costing methods. (Round your average cost per unit to 2 decimal places.) 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?

Montoure Company uses a perpetual inventory system. It entered into the following calendar-year purchases and sales transactions. Date Activities Units Acquired at Cost Units Sold at Retail January 1 Beginning inventory 680 units @ $40 per unit February 10 Purchase 320 units @ $35 per unit March 13 Purchase 100 units @ $23 per unit March 15 Sales 720 units @ $75 per unit August 21 Purchase 130 units @ $45 per unit September 5 Purchase 490 units @ $41 per unit September 10 Sales 620 units @ $75 per unit Totals 1,720 units 1,340 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. Ending inventory units 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 680 units from beginning inventory, 220 from the February 10 purchase, 100 from the March 13 purchase, 80 from the August 21 purchase, and 260 from the September 5 purchase.) Complete this question by entering your answers in the tabs below. Perpetual FIFO Perpetual LIFO Weighted Average Specific Id Compute the cost assigned to ending inventory using FIFO. (Round your average cost per unit to 2 decimal places.) Perpetual FIFO: Cost of Goods Sold Cost per # of units sold Cost of Goods Sold unit Goods Purchased Cost per # of units unit Date Inventory Balance Cost per # of units Inventory Balance unit 680 at $ 40.00 $ 27,200.00 January 1 February 10 Total February 10 March 13 Total March 13 March 15 Total March 15 August 21 Total August 21 September 5 Total September 5 September 10 Total September 10 Totals $ 0.00 $ 0.00 Perpetual FIFO Perpetual LIFO > Perpetual FIFO Perpetual LIFO Weighted Average Specific Id Compute the cost assigned to ending inventory using LIFO. (Round your average cost per unit to 2 decimal places.) Perpetual LIFO: Goods Purchased Cost of Goods Sold Inventory Balance Date Cost per # of units Cost per unit # of units sold Cost of Goods Sold # of units unit Cost per Inventory Balance unit $ 40.00 = $ 27,200.00 January 1 680 at February 10 Total February 10 March 13 Total March 13 March 15 Total March 15 August 21 Total August 21 September 5 Total September 5 September 10 0.00 Total September 10 Totals $ 0.00 Perpetual FIFO Perpetual LIFO Weighted Average Specific Id Compute the cost assigned to ending inventory using weighted average. (Round your average cost per unit to 2 decimal places.) Weighted Average Perpetual: Cost of Goods Sold Date Goods Purchased Cost # of units per unit Cost per # of units sold Cost of Goods Sold Inventory Balance Cost per Inventory # of units unit Balance 680 at $ 40.00 - $ 27,200.00 unit January 1 February 10 Average February 10 March 13 Average March 13 March 15 August 21 Average August 21 September 5 Average September 5 September 10 Totals $ 0.00 Perpetual FIFO Perpetual LIFO Weighted Average Specific Id Compute the cost assigned to ending inventory using specific identification. (For specific identification, units sold consist of 680 units from beginning inventory, 220 from the Febr March 13 purchase. 80 from the August 21 purchase, and 260 from the September 5 purchase.) Specific Identification: Goods Purchased Cost of Goods Sold Date Cost per # of units # of units sold Cost of Goods Sold # of units unit Inventory Balance Cost per Inventory Balance unit $ 40.00 = $ 0.00 $ 35.00 = $ 23.00 0.00 680 at $ 40.00 at Cost per unit $ 40.00 $ 35.00 $ 23.00 = $ 0.00 at at $ 35.00 at = at 320 100 at $ 23.00 at = 0.00 at = January 1 February 10 March 13 August 21 September 5 Totals 130 at at = at $ 45.00 $ 41.00 $ 45.00 $ 41.00 $ 45.00 = $ 41.00 = 490 at at = 0.00 at 0.00 1,720 0 $ 0.00 0 $ 0.00 4. Compute gross profit earned by the company for each of the four costing methods. (Round your average cost per unit to 2 decimal places.) FIFO LIFO Weighted Average Specific Identification Sales Less: Cost of goods sold Gross profit $ 0 $ 0 $ 0 $ 0 5. The company's manager earns a bonus based on a percent of gross profit. Which method of inventory costing produces the highest bonus for the manager? O FIFO OLIFO O Specific Identification OLIFO