Tom Pryor is conducting an audit of the computerized inventory system used by Zix Corporation....
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Accounting
Tom Pryor is conducting an audit of the computerized inventory system used by Zix Corporation. Tom has inserted hypothetical data into the computer program that tracks inventory on a perpetual basis. Below are the hypotheical data inserted by Tom: Transaction Units Cost per unit Beginning inventory 10 $10 Purchase, day 1 5 $11 Sale, day 2 6 Purchase, day 3 8 $12 Sale, day 4 9 The computer program returned the following ending inventory values: FIFO perpetual, $96 LIFO perpetual, $80 Moving average, $88 Which of the three values appears to be incorrect, and what "error" might be causing this condition?
FIFO perpetual: Date Purchases Cost of Goods Sold Balance Day 0 10 X $10 = $100 Day 1 5 X $11 = $55 Day 2 Day 3 8 X $12 = $96 Day 4 Ending LIFO perpetual: Date Purchases Cost of Goods Sold Balance Day 0 10 X $10 = $100 Day 1 5 X $11 = $55 Day 2 Day 3 8 X $12 = $96 Day 4 Ending Moving average: Date Purchases Cost of Goods Sold Balance Day 0 10 X $10 = $100 Day 1 5 X $11 = $55 Day 2 Day 3 8 X $12 = $96 Day 4 Ending
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