Question

Cost Flow Methods The following three identical units of Item K113 are purchased during April: Item Beta April 2 Units 1 1 Purchase Purchase Cost $77 79 $77 April 15 April 20 Purchase 81 Total 3 $237 Average cost per unit $79 ($237 = 3 units) Assume that one unit is sold on April 27 for $103. Determine the gross profit for April and ending inventory on April 30 using the (a) first-in, first-out (FIFO); (b) last-in, first-out (LIFO); and (c) weighted average cost method. Gross Profit Ending Inventory जी पी a. First-in, first-out (FIFO) b. Last-in, first-out (LIFO) जी पी c. Weighted average cost जी जी

Answer 1

	Gross Profit	Ending inventory
a) First-in, first out (FIFO)	(1*103-1*77)= $26	(1*79+1*81)= $160
b) Last-in, first out (LIFO)	(1*103-1*81)= $22	(1*77+1*79)= $156
c) Weighted average cost	(1*103-1*79)= $24	(2*79)= $158

Answer 2