Riverbed-Mart Centre Inc. opened for business on May 1, and uses a perpetual inventory system. During May, the company had the following purchases and sales for one of its products:

			Purchases				Sales
Date			Units		Unit Cost		Units		Unit Price
May	1		120		$100
	3						80		$258
	8		100		109
	13						80		281
	15		60		115
	20						60		307
	27						40		331

Determine the cost of goods sold and cost of ending inventory using (1) FIFO and (2) average cost. (Round Average answers to 2 decimal places, e.g. 5.75.)

		FIFO		Average
Cost of Goods Sold		$		$
Ending Inventory		$		$

Question Part Score

--/4

Identify the cost formula the company should use if it wants to maximize gross profit and net income? Choose your answer here FIFOAverageNeither

Question Part Score

--/1

Which cost formula produces the higher ending inventory valuation? Choose your answer here FIFOAverageNeither

QUESTION 2

On March 1, 2022, Oriole Corporation acquired real estate, on which it planned to construct a small office building, by paying $70,400 in cash. An old warehouse on the property was demolished at a cost of $7,200; the salvaged materials were sold for $1,480. Additional expenditures before construction began included a $1,320 legal fee for work concerning the land purchase, a $8,000 architects fee, and $12,320 to put in driveways and a parking lot.

Determine the amount to be reported as the cost of the land.

Cost of Land