Required: Hemming uses a periodic inventory system. Assume that ending inventory is consists of 45 units from the March 14 purchase, 75 units from the July 30 purchase, and all 105 units from the October 26 purchase. Using the specific identification method, calculate the (a) the cost of goods sold and (b) the gross profit. Required information (The following information applies to the questions displayed below.] Hemming Co. reported the following current-year purchases and sales for its only product. Date Activities Jan. 1 Beginning inventory Jan. 10 Sales Mar. 14 Purchase Mar. 15 Sales July 30 Purchase Oct. 5 Sales Oct. 26 Purchase Totals Units Acquired at Cost Units Sold at Retail 205 units @ $10.20 = $ 2,091 160 units @ $40.20 300 units @ $15.20 = 4,560 250 units @ $40.20 400 units @ $20.20 = 8,080 375 units @ $40.20 105 units @ $25.20 = 2,646 1,010 units $17,377 785 units Required A Required B Required C Determine the costs assigned to ending inventory and to cost of goods sold using FIFO. a) Periodic FIFO Cost of Goods Available for Sale Cost of Goods Sold Ending Inventory Cost per Cost per # of units Cost of Goods Available for Sale # of units sold Cost per Cost of Goods Sold # of units in ending inventory Ending Inventory unit unit unit 205 $ 10.20 $ 2,091 205 $ 10.20 2,091 0 Beginning inventory Purchases: March 14 300 $ 15.20 300 $ 15.20 4,560 0 4,560 8,080 400 280 $ 20.20 5,656 120 $ 20.20 2,424 July 30 October 26 $ 20.20 $ 25.20 105 2,646 0 105 $ 25.20 2,646 5,070 Total 1,010 $ 17,377 785 $ 12,307 225 $ Required A Required B > Required A Required B Required C Determine the costs assigned to ending inventory and to cost of goods sold using LIFO. b) Periodic LIFO Cost of Goods Available for Sale Cost of Goods Sold Ending Inventory Cost per Cost # of units Cost of Goods Available for Sale # of units sold Cost per unit Cost of Goods Sold # of units in ending inventory Ending Inventory unit per unit 205 $ 10.20 $ 2,091 0 205 $10.20 $ 2,091 Beginning inventory Purchases: March 14 300 $ 15.20 4,560 280 $ 15.20 4,256 20 $15.20 304 July 30 400 $ 20.20 8,080 400 $ 20.20 0 8,080 2,646 October 26 105 $ 25.20 2,646 105 $ 25.20 0 Total 1,010 $ 17,377 785 $ 14,982 225 $ 2,395 Required A Required C > Required A Required B Required c Compute the gross margin for each method. FIFO LIFO $ 31,557 c) Gross Margin Sales Cost of goods sold Gross margin 12,307 $ 31,557 14,982 $ 16,575 $ 19,250