Compare resultsfor the three cost flow assumptions

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Reference no: EM13134477

You are providedwith the following informationfor Pavey Inc. for the month ended October 31, 2011. Pavey uses a periodic methodfor inventory. Date Description Units Unit Cost or Selling Price October 1 Beginning inventory 60 $25 October 9 Purchase 120 26 October 11 Sale 100 35 October 17 Purchase 70 27 October 22 Sale 60 40 October 25 Purchase 80 28 October 29 Sale 110 40 (a) Calculate (i) ending inventory, (ii) costof goods sold, (iii) gross profit, and (iv) gross profit rate under each of the following methods. (Round weighted-average costper unit to 3 decimal places, e.g. 2.250. Use the rounded amount for future computations. Round gross profit rate to 1 decimal place, e.g. 10.5% and all other answers to 0 decimal places, e.g. 125.) (1) LIFO. (2) FIFO. (3) Average-cost. LIFO FIFO Average Cost Ending inventory $ $ $ Cost of goods sold $ $ $ Gross profit $ $ $ Gross profit rate % % % (b) Compare resultsfor the three cost flow assumptions. What cost flow resultsin the lowest inventory value.

Reference no: EM13134477

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