Topanga Group began operations early in 2018. Inventory purchase information for the quarter ended March 31, 2018,
Question:
Sales for the quarter, all at $7.00 per unit, totaled 20,000 units leaving 14,000 units on hand at the end of the quarter.
Required:
1. Calculate the Topanga's gross profit ratio for the first quarter using:
a. FIFO
b. LIFO
c. Average cost
2. Comment on the relative effect of each of the three inventory methods on the gross profit ratio.
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Related Book For
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
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