Name two recognized methods of estimating the cost of ending inventory.

Assuming periodic inventory procedure, what effect would an understatement of ending inventory have on the different items on the financial statements? Balance Sheet Income Statement Current Assets ------------------ Cost of Goods Sold ------------------- Total Assets ------------------ Gross Margin ------------------- Retained Earnings --------------- Net Income -------------------- Total Liabilities and Retained Earnings ------------------ Both __________-__________, __________-__________ and __________-__________, __________-__________ methods of inventory valuation are assumptions as to the flow of costs. Following is a summary of beginning inventory, purchases, and sales. At what amount would the inventory be priced assuming, the first-in, first-out method is used under perpetual invventory procedure? Beg. Inv., Jan. 1 2,400 units @ $8.80 Purchases: Jan. 8 5,600 units @ $9.00 Mar. 15 2,000 units @ $9.10 Jul. 28 2,800 units @ $9.50 Nov. 30 400 units @ $9.70 Sales: Feb. 13 3,000 units Jun. 9 2,800 units Sep. 22 1,400 units