Part A

During the year, Heron Company has the following inventory transactions.

Date	Transaction	Number of Units	Unit Cost	Total Cost
Jan. 1	Beginning inventory	35	$42	$1,470
March 4	Purchase	122	44	5,368
June 16	Purchase	184	47	8,648
Sept. 9	Purchase	105	48	5,040
	Total	446		20,526

During the year, Heron sells 385 units of inventory for $55 each.

1. 1. Assuming the FIFO inventory cost method, calculate ending inventory, cost of goods sold, sales revenue, and gross profit for the year.
   2. Assuming the LIFO inventory cost method, calculate ending inventory, cost of goods sold, sales revenue, and gross profit for the year.
   3. Assuming the weighted-average inventory cost method, calculate ending inventory, cost of goods sold, sales revenue, and gross profit for the year. (Round weighted-average cost per unit to two decimal places.)
   4. Which method results in the highest profit? Please explain your answer.

Part B

Owl Company has the following transactions during March: March 3 Purchases inventory on account for $3,300, terms 3/10, n/30. March 5 Pays freight costs of $280 on inventory purchased on March 3. March 6 Returns inventory with a cost of $700. March 12 Pays the full amount due on March 3 purchase. March 29 Sells all inventory purchased on March 3 (less those returned on March 6) for $5,700 on account.

Record all transactions, assuming the company uses a perpetual inventory system.

Part C: Using the formulas for inventory turnover ratio, average days in inventory, and gross profit ratio, compute answers for the following two problems:

First problem: A company reports the following amounts for 2030: Inventory (beginning) $ 20,000 Inventory (ending) 30,000 Purchases 160,000 Purchase returns 10,000

Compute the following financial calculations for 2030:

• Cost of goods sold
• Inventory turnover ratio
• Average days in inventory

Second problem: A company reports the following amounts at the end of the year: Sales revenue $ 360,000 Cost of goods sold 215,000 Net income 58,000

Compute the company's gross profit ratio.