Paddington Gifts made purchases of a particular product in the current year as follows:

Jan.

1

Beginning inventory

270

units

@

$

6.30

=

$

1,701

Mar.

7

Purchased

530

units

@

$

5.90

=

3,127

July

28

Purchased

1,000

units

@

$

5.30

=

5,300

Oct.

3

Purchased

870

units

@

$

4.70

=

4,089

Totals

2,670

units

$

14,217

Required:

1. The business uses a periodic inventory system. Ending inventory consists of 120 units. Calculate the costs to be assigned to the ending inventory and to goods sold under: (Round intermediate calculations and final answers to 2 decimal places for "Weighted average cost".)

2. Which method provides the lower profit?

multiple choice

FIFO Weighted-average cost