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Use the following information to calculate the ending inventory cost on December 31 and the cost of goods sold for December under each of three...
1.Use the following information to calculate the ending inventory cost on December 31 and the cost of goods sold for December under each of three methods: (a) FIFO, (b) LIFO, and (c) Weighted Average. Assume the periodic inventory system is used. (Show your work.)
Dec. 1 Beginning inventory 1,000 units @ $7
5 Purchased 3,000 units @ $7.10
18 Purchased 4,000 units @ $7.15
24 Purchased 2,000 units @ $7.20
31 Ending inventory 2,500 units
2. Assuming that ending inventory for 20x7 was overstated, indicate whether each of the following will be understated (U), overstated (O), or not affected (N).
_____ 1. Beginning inventory for 20x8
_____ 2. Cost of goods sold for 20x7
_____ 3. Stockholders' equity at the end of 20x8
_____ 4. Income before income taxes for 20x8
_____ 5. Stockholders' equity at the end of 20x7
_____ 6. Cost of goods sold for 20x8
_____ 7. Income before income taxes for 20x7
