Warnerwoods Company uses a periodic inventory system. It entered into the following purchases and sales...
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Accounting
Warnerwoods Company uses a periodic inventory system. It entered into the following purchases and sales transactions for March.
Date
Activities
Units Acquired at Cost
Units Sold at Retail
Mar.
1
Beginning inventory
170
units
@ $60 per unit
Mar.
5
Purchase
470
units
@ $65 per unit
Mar.
9
Sales
490
units
@ $95 per unit
Mar.
18
Purchase
260
units
@ $70 per unit
Mar.
25
Purchase
340
units
@ $72 per unit
Mar.
29
Sales
300
units
@ $105 per unit
Totals
1,240
units
790
units
For specific identification, the March 9 sale consisted of 90 units from beginning inventory and 400 units from the March 5 purchase; the March 29 sale consisted of 110 units from the March 18 purchase and 190 units from the March 25 purchase.
1. Compute gross profit earned by the company for each of the four costing methods
2, Compute the cost assigned to ending inventory using (a) FIFO, (b) LIFO, (c) weighted average, and (d) specific identification
Answer & Explanation
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