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Use the following information for the Exercises 3-7 below. (Algo)

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Laker Company reported the following January purchases and sales data for its only product. The Company uses a periodic inventory system. For specific identification, ending inventory consists of 202 units, where 180 are from the January 30 purchase, 5 are from the January 20 purchase, and 17 are from beginning inventory.

Date	Activities	Units Acquired at Cost						Units sold at Retail
January 1	Beginning inventory	141	units	@	$ 6.00	=	$ 846
January 10	Sales							99	units	@	$ 15.00
January 20	Purchase	61	units	@	$ 5.00	=	305
January 25	Sales							81	units	@	$ 15.00
January 30	Purchase	180	units	@	$ 4.50	=	810
	Totals	382	units				$ 1,961	180	units

Exercise 5-7A (Algo) Perpetual: Gross profit effects of inventory methods LO P3, A1

Required:

Compute gross profit for the month of January for Laker Company for the four inventory methods.

Which method yields the highest gross profit?

Does gross profit using weighted average fall between that using FIFO and LIFO?

If costs were rising instead of falling, which method would yield the highest gross profit?