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Question - Erie Jewelers sells gold earrings. Its beginning inventory of Model 407 gold earrings consisted of 120 pairs of earrings at $50 per pair.
Erie purchased two batches of Model 407 earrings during the year. The first batch purchased consisted of 140 pairs at $53 per pair; the second batch consisted of 200 pairs at $56 per pair. During the year, Erie sold 355 pairs of Model 407 earrings.
Required - Determine the amount of product cost Erie would allocate to cost of goods sold and ending inventory assuming that Erie uses (a) FIFO (b) LIFO, and (c) weighted average.
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