Question

Athletic world began January with merchandise inventory of 70 crates of vitamins that cost a total of $4,550. During the month, Athletic World purchased and sold merchandise on account
onth, Athletic World purchased and sold merchandise on account as follows: pany's cost of goods sold, ending merchandise inventory, and gross profit method. Enter the transactions in chronological order, calculating new inventory on hand balances after purchased, sold, and on hand at the end of the period. (Enter the oldest inventory layers first) Requirements 1. Prepare a perpetual inventory record, using the FIFO inventory costing method, and determine the company's cost of goods sold, ending merchandise inventory, and gross profit Prepare a perpetual inventory record, using the LIFO inventory costing method, and determine the company's cost of goods sold, ending merchandise inventory, and gross profit Prepare a perpetual inventory record, using the weighted average inventory costing method, and determine the company's cost of goods sold, ending merchandise inventory, and gross profit (Round weighted-average cost per unit to the nearest cent and all other amounts to the nearest dollar) the business wanted to pay the least amount of income taxes possible which method would it choose? 4. Print Done Clear A
as follows.

Answer 1

Correct Answer:

Perpetual	FIFO	LIFO	Weighted-Average
Cost of goods sold	$    22,730.00	$    23,630.00	$    22,885.00
Ending inventory	$      4,150.00	$      3,250.00	$      3,995.00
Gross profit	$    10,310.00	$      9,410.00	$   10,155.00

Working:

	FIFO	LIFO	Weighted-Average
Sales revenue	$    33,040.00	$    33,040.00	$    33,040.00
Less: cost of goods sold	$    22,730.00	$    23,630.00	$    22,885.00
Gross profit	$    10,310.00	$      9,410.00	$    10,155.00

Perpetual FIFO
Date	Goods Purchased			Cost of Goods Sold				Inventory Balance
	# of Units	Cost Per Unit	Cost of Goods Available for sale	# of Units Sold	Cost per Unit		Cost of Goods Sold	# of Units	Cost per Unit		Inventory Balance
01-Jan								70	$          65.00		$       4,550.00
05-Jan	130	$         76.00	$         9,880.00					130	$          76.00		$       9,880.00
								70	$          65.00		$       4,550.00
13-Jan				70	$             65.00		$      4,550.00
				70	$             76.00		$      5,320.00	60	$          76.00		$       4,560.00
18-Jan	150	$ 83.00	$       12,450.00					150	$          83.00		$    12,450.00
								60	$          76.00		$       4,560.00
26-Jan				60	$             76.00		$      4,560.00
				100	$             83.00		$      8,300.00	50	$          83.00		$       4,150.00
				Cost of goods sold				Ending Inventory
Total				300			$    22,730.00	50			$       4,150.00

Perpetual LIFO
Date	Goods Purchased			Cost of Goods Sold			Inventory Balance
	# of Units	Cost Per Unit	Cost of Goods Available for sale	# of Units Sold	Cost per Unit	Cost of Goods Sold	# of Units	Cost per Unit	Inventory Balance
01-Jan							70	$          65.00	$       4,550.00
05-Jan	130	$               76.00	$         9,880.00				130	$          76.00	$       9,880.00
							70	$          65.00	$       4,550.00
13-Jan				10	$             65.00	$          650.00
				130	$             76.00	$      9,880.00	60	$          65.00	$       3,900.00
18-Jan	150	$               83.00	$       12,450.00				150	$          83.00	$    12,450.00
							60	$          65.00	$       3,900.00
26-Jan				10	$             65.00	$          650.00
				150	$             83.00	$    12,450.00	50	$          65.00	$       3,250.00
				Cost of goods sold			Ending Inventory
Total				300		$    23,630.00	50		$       3,250.00

Perpetual Weighed-Average
Date	Goods Purchased			Cost of Goods Sold				Inventory Balance
	# of Units	Cost Per Unit	Cost of Goods Available for sale	# of Units Sold	Cost per Unit		Cost of Goods Sold	# of Units	Cost per Unit		Inventory Balance
01-Jan								70	$          65.00		$       4,550.00
05-Jan	130	$               76.00	$         9,880.00					200	$          72.15		$    14,430.00
13-Jan				140	$             72.15		$    10,101.00
								60	$          72.15		$       4,329.00
18-Jan	150	$               83.00	$       12,450.00					210	$          79.90		$    16,779.00
26-Jan				160	$             79.90		$    12,784.00
								50	$          79.90		$       3,995.00
				Cost of goods sold				Ending Inventory
Total				300		$    22,885.00		50		$       3,995.00

End of answer.

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