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Inventory calculations

Please see attachment.

You are provided with the following information for Pavey Inc. for the month ended October 31, 2008. Pavey uses a periodic method for inventory.

Date
Description
Units
Unit Cost or
Selling Price

October 1 Beginning inventory 60 $25
October 9 Purchase 120 26
October 11 Sale 100 35
October 17 Purchase 70 27
October 22 Sale 60 40
October 25 Purchase 80 28
October 29 Sale 110 40

Instructions

(a) Calculate (i) ending inventory, (ii) cost of goods sold, (iii) gross profit, and (iv) gross profit rate under each of the following methods. (Round weighted-average cost per unit to 3 decimal places and use the rounded amount for future computations. Round gross profit rate to 1 decimal place and all other answers to 0 decimal places.)
(1) LIFO.
(2) FIFO.
(3) Average-cost.

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Solution Summary

The solution explains the calculation of (i) ending inventory, (ii) cost of goods sold, (iii) gross profit, and (iv) gross profit rate under (1) LIFO ,(2) FIFO and (3) Average-cost.

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