P2-4 Inventory costing methods The purchases and issues of rubber gaskets (Materials Ledger #11216) as shown in the records of HD Corporation for the month of November follow: Unit Price $3.00 Nov. 1 4 3.10 5 Units 30,000 10,000 30,000 50,000 20,000 25,000 30,000 Beginning balance Received, Rec. Report No. 112 Issued, Mat. Req. No. 49 Received, Rec. Report No. 113 Issued, Mat. Reg. No. 50 Received, Rec. Report No. 114 Issued, Mat. Req. No.51 8 3.30 15 22 3.50 28 Required: 1. Complete a materials ledger account similar to Figure 2-10 (the "On Order" columns should be omitted) for each of the follow- ing inventory costing methods, using a perpetual inventory system: a. FIFO b. LIFO C. Moving average (carrying unit prices to five decimal places) 2. For each method, prepare a schedule that shows the total cost of materials transferred to Work in Process and the cost of the ending inventory. 3. If prices continue to increase, would you favor adopting the FIFO or the LIFO method? Explain. 4. When prices continue to rise, what is the effect of FIFO versus LIFO on the inventory balance for materials reported in the balance sheet? Discuss