Question 2 Calculating the value of inventory and cost of goods sold using various cost-flow assumptions. a) Compute the ending inventory value at September 30 and the cost of goods sold using LIFO, FIFO and average cost methods using a periodic system. Prove the amount allocated to cost of goods sold under each method. b) Explain why the average cost is not $6. c) Assume that the selling price per unit is $10. Calculate the gross profit under each cost flow assumption. d) Which method would the company choose to minimize taxes? Which method would be company choose if they were applying for a bank loan? B \begin{tabular}{|c|c|c|} \hline C & D & E \\ \hline PURCHASES & 690 & \\ \hline CS & -230 & \\ \hline COGS & 460 \\ \hline SP & 10 \\ \hline \end{tabular} \begin{tabular}{|c|c|c|c|c|} \hline Date & Event & Units & \begin{tabular}{c} Unit \\ cost \end{tabular} & \begin{tabular}{c} Total \\ Cost \end{tabular} \\ \hline 01-Sep & Inventory & 120 & $5 & $600 \\ \hline 15Sep & Purchase & 370 & 6 & 2220 \\ \hline 24Sep & Purchase & 200 & 7 & 1400 \\ \hline 30Sep & Inventory & 230 & & \\ \hline \end{tabular}