Question

Monty Corp. uses the periodic inventory system and had 150 units in beginning inventory at a total cost of $15,000. The company purchased 300 units at a total cost of $39,000. At the end of the year, Monty had 80 units in ending inventory.

Compute the cost of the ending inventory and the cost of goods sold under FIFO, LIFO, and average-cost. (Round average-cost per unit and final answers to 0 decimal places, e.g. 1,250.)

		FIFO		LIFO		Average-cost
The cost of the ending inventory		$		$		$
The cost of goods sold		$		$		$

Which cost flow method would result in the highest net income?

Which cost flow method would result in inventories approximating current cost in the balance sheet?

Which cost flow method would result in Monty paying the least taxes in the first year?

Answer 1