The Shirt Shop had the following transactions for T-shirts for Year 1, its first year of operations:

Jan. 20	Purchased	300	units	@	$	5	=	$	1,500
Apr. 21	Purchased	110	units	@	$	6	=		660
July 25	Purchased	240	units	@	$	7	=		1,680
Sept. 19	Purchased	60	units	@	$	8	=		480

During the year, The Shirt Shop sold 510 T-shirts for $13 each.

Required

1. 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.
2. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions.Complete this question by entering your answers in the tabs below.

• Required A
• Required B

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 intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount.)

	FIFO	LIFO	Weighted Average
Ending inventory

Complete this question by entering your answers in the tabs below.

• Required A
• Required B

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

	FIFO	LIFO	Difference
Gross margin