Calculate ending inventory and cost of goods sold using the last in, first out (LIFO); moving; and weighted average methods.

Calculate ending inventory and cost of goods sold using the last in, first out (LIFO); moving; and weighted average methods.

Calculate ending inventory and cost of goods sold using the last in, first out (LIFO); moving; and weighted average methods.

Tony Merchandise Company has the following information for the month of February:

Feb. 2 Beginning inventory 20 units @ $12 per unit
Feb. 5 Purchase 20 units @ $16 per unit
Feb. 8 Sale 12 units
Feb. 21 Purchase 12 units @ $18 per unit
Feb. 25 Sale 14 units

Answer the following questions for Tony Merchandise Company:

1. Calculate the dollar ending inventory if first in, first out (FIFO) is used.

2. Calculate the cost of goods sold if LIFO is used.

3. Calculate the dollar ending inventory if weighted average is used.

4. According to the generally accepted accounting principles (GAAP), discuss the objectives of inventory costing.

5. Discuss the consequences of selecting one method instead of others.


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