Mullins Distribution markets CDs of numerous performing artists. At the beginning of March, Mullins had in beginning inventory 2,500 CDs with a unit cost of $7. During March, Mullins made the following purchases of CDs.

Mar. 5 2000 @ $8

Mar. 13 3500 @ $9

Mar. 21 5000 @ $10

Mar. 26 2000 @ $11

A determine the cost of goods available for sale.

B: Determine (1) the ending inventory and (2) the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average cost). Prove the accuracy of the cost of goods sold under the FIFO and LIFO methods (Note: For average-cost round the weighted-average unit cost to three decimal places.)

C: which cost flow method results in (1) the highest inventory amount for the balance sheet and (2) the highest cost of goods sold for the income statement?

NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a ?

Cost of Goods Sold Cost of goods available for sale Less: Ending inventory Cost of goods sold Value Value ? Date Mar. 1 5 Proof of Cost of Goods Sold Units Unit Cost Value Value Value Value Value Value Value Value ? Total Cost ? ? ? ? 13 21 ? LIFO Date Mar. 1 5 Ending Inventory Units Unit Cost Value Value Value Value Total Cost ? ? ? ? Cost of Goods Sold Cost of goods available for sale Less: Ending inventory Cost of goods sold Value Value ? Date Mar. 26 21 13 5 Proof of Cost of Goods Sold Units Unit Cost Value Value Value Value Value Value Value Value ? Total Cost ? ? ? ? ? AVERAGE COST Total cost Total units available Average cost* *Round to two decimal points Value Value ? Units Value Ending Inventory Unit Cost Value Total Cost Value Cost of Goods Sold Cost of goods available for sale Less: Ending inventory Cost of goods sold Value Value