Question

Alternative Inventory Methods Park Company's perpetual inventory records indicate the following transactions in the month of June: Units Cost/Unit Inventory, June 1 200 $3.20 Purchases: June 3 200 3.50 June 17 250 3.60 June 24 300 3.65 Sales: June 6 300 June 21 200 June 27 150 Required: 1. Compute the cost of goods sold for June and the inventory at the end of June using each of the following cost flow assumptions: If required, round your answers to the nearest dollar. FIFO Cost of Goods Sold $ Ending Inventory $ LIFO (Round your intermediate calculations and final answers to the nearest cent.) Cost of Goods Sold $ Ending Inventory $ Average cost (In your computations, round new per unit costs to the nearest cent. Round your intermediate computations and final answers to the nearest dollar.) Cost of Goods Sold $ Ending Inventory $ 2. Why are the cost of goods sold and ending inventory amounts different for each of the three methods? 3. produces the most realistic amount for net income because it produces the most realistic amount for ending inventory because it 4. If Park uses IFRS, which of the previous alternatives would be acceptable and why? The input in the box below will not be graded, but may be reviewed and considered by your instructor.

Answer 1