AP Jeters Company uses a periodic inventory system and reports the following for the month of...

AP Jeters Company uses a periodic inventory system and reports the following for the month of June.

Date	Explanation	Units	Unit cost	Total cost
June 1	Inventory	120	$5	$600
June 12	Purchase	370	$6	$2200
June 23	Purchase	200	$7	$1400
June 30	Inventory	230

Instructions

a. Compute the cost of the ending inventory and the cost of goods sold under (1) FIFO, (2) LIFO, and (3) average-cost. (Round average unit cost to three decimal places.)

b. Which costing method gives the highest ending inventory? The highest cost of goods sold? Why?

c. How do the average-cost values for ending inventory and cost of goods sold relate to ending inventory and cost of goods sold for FIFO and LIFO?

d. Explain why the average cost is not $6.

Expert Solution

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ekkarill92 answered 2 years ago

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