The following three identical units of Item Alpha are purchased during April: Item Alpha Units Cost Apr. Purchase 1 $66 14 Purchase 1 70 28 Purchase 1 74 Total 3 $210 Average cost per unit $70 ($210 3 units) Assume that one unit is sold on April 30 for $88. Determine the gross profit for April and ending inventory on April 30 using the (a) first-in, first-out (FIFO); (b) last-in, first-out (LIFO); and (c) weighted average cost methods. Gross Profit Ending Inventory a. First-in, first-out (FIFO) $4 $4 b. Last-in, first-out (LIFO) $ c. Weighted average cost $

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Chapter1: Financial Statements And Business Decisions
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Cost Flow Methods
The following three identical units of Item Alpha are purchased during April:
Item Alpha
Units
Cost
Apr.
Purchase
$66
14
Purchase
1
70
28
Purchase
1
74
Total
3
$210
Average cost per unit
$70 ($210 ÷ 3 units)
Assume that one unit is sold on April 30 for $88.
Determine the gross profit for April and ending inventory on April 30 using the (a) first-in, first-out (FIFO); (b)
last-in, first-out (LIFO); and (c) weighted average cost methods.
Gross Profit
Ending Inventory
a. First-in, first-out (FIFO)
2$
b. Last-in, first-out (LIFO)
2$
c. Weighted average cost
Transcribed Image Text:Cost Flow Methods The following three identical units of Item Alpha are purchased during April: Item Alpha Units Cost Apr. Purchase $66 14 Purchase 1 70 28 Purchase 1 74 Total 3 $210 Average cost per unit $70 ($210 ÷ 3 units) Assume that one unit is sold on April 30 for $88. Determine the gross profit for April and ending inventory on April 30 using the (a) first-in, first-out (FIFO); (b) last-in, first-out (LIFO); and (c) weighted average cost methods. Gross Profit Ending Inventory a. First-in, first-out (FIFO) 2$ b. Last-in, first-out (LIFO) 2$ c. Weighted average cost
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