SOURCES A company just starting business made the following

SOURCES A company just starting business made the following four inventory purchases in June: EQUIRED Number of units Date une 1 une 10 June 15 June 28 purchased 150 units 200 units 200 units 150 units Total cost $ 390 585 630 510 $2115 A physical count of merchandise inventory on June 30 reveals that there are 250 units on hand The inventory method which results in the highest gross profit for June is O the weighted average unit cost method. O not determinable. 0 the FIFO method. the LIFO method. 10371 0 Type here to search

Solution

1) ending inventory under fifo method will be 510   + (630/200)*100 825 under LIFO method 390 + (585/200)*100 682.5 thus under LIFO method Cost of goods sold will be more than the FIFO method hence highest gross profit will result under FIFO method answer-the FIFO method Q51) December 31 inventory 5000 units at the rate of 7.25 36250 answer Q59) Sales (150*70)= 10500 less :cost of goods sold(54*45+93*47+3*49) 6948 Gross profit 3552 less :income tax (3552*30%) 1065.6 net income 2486.4 2486- answer Q60) Gross profit using LIFO sales 10,500 less :cost of goods sold (66*49+84*47) 7182 Gross profit. 3,318 3318- answer Q61) Ending inventory under LIFO is 30 units @8   + 60 units @8.30 738 answer