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Calculate Ending Inventory

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Building Supplies Pte Ltd is a supplier of cements to the building and construction industry. The following transactions were recorded for the month of Aug 2006.

a) Calculate the ending inventory and the gross profit for the month of August under each of the three inventory costing methods:

i) Weight Average Cost
ii) LIFO
iii) FIFO

b) What observations can you make regarding the portrayal of financial position and performance under each method when prices are increasing.

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The solution calculates the ending inventory for Building Supplies Ltd using a number of different methods.

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When prices are increasing, the LIFO ...

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