Required information Skip to question [The following information applies to the questions displayed below.] The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of operations: Jan. 20 Purchased 540 units @ $ 7 = $ 3,780 Apr. 21 Purchased 340 units @ $ 9 = 3,060 July 25 Purchased 420 units @ $ 12 = 5,040 Sept. 19 Purchased 230 units @ $ 14 = 3,220 During the year, The Shirt Shop sold 1,230 T-shirts for $23 each.

A. Compute the amount of ending inventory The Shirt Shop would report on the balance sheet, assuming the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average. (Round cost per unit to 2 decimal places and final answers to the nearest whole dollar amount.)

B. Record the above transactions in general journal form and post to T-accounts using (1) FIFO, (2) LIFO, and (3) weighted average. Use a separate set of journal entries and T-accounts for each method. Assume all transactions are cash transactions.

C. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions.