You are provided with the following information for Lily Inc. for the month ended June 30, 2022. Lily uses the periodic method for inventory system.Date Description Quantity Unit Cost orSelling PriceJune1 Beginning inventory 40 $34 June4 Purchase 135 37 June10 Sale 110 60 June11 Sale return 15 60 June18 Purchase 55 40 June18 Purchase return 10 40 June25 Sale 54 65 June28 Purchase 35 43 Calculate weighted-average unit cost. (Round answer to 3 decimal places, e.g. 5.225.)Weighted-average unit cost $Enter the weighted-average cost per unit in dollars Calculate ending inventory, cost of goods sold, and gross profit under each of the following methods: (1) LIFO, (2) FIFO, and (3) average-cost. (Round average-cost method answers to 2 decimal places, e.g. 1,250.25 and other answers to 0 decimal places, e.g. 1,250.) LIFO FIFO AVERAGE-COSTThe ending inventory $Enter a dollar amount $Enter a dollar amount $Enter a dollar amount The cost of goods sold $Enter a dollar amount $Enter a dollar amount $Enter a dollar amount Gross profit $Enter a dollar amount $Enter a dollar amount $Enter a dollar amount Calculate gross profit rate under each of the following methods: (1) LIFO., (2) FIFO and (3) average-cost. (Round answers to 1 decimal place, e.g. 51.2%.) LIFO FIFO AVERAGE-COSTGross profit rate Enter percentages % Enter percentages % Enter percentages % Compare the results for the three cost flow assumptions and answer the following questions.In this period of rising prices, Select a cost flow assumption FIFOAverage-costLIFO gives the highest cost of goods sold and the Select an option highestlowest gross profit.Select a cost flow assumption FIFOLIFOAverage-cost gives the lowest cost of goods sold and the Select an option highestlowest gross profit.Average-cost gives results that fall Select an option abovebelowbetween those for LIFO and FIFO.

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Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter6: Cost Of Goods Sold And Inventory

Section: Chapter Questions

Problem 50E: Inventory Costing Methods Crandall Distributors uses a perpetual inventory system and has the...

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Date		Description		Quantity		Unit Cost or Selling Price
June	1		Beginning inventory		40		$34
June	4		Purchase		135		37
June	10		Sale		110		60
June	11		Sale return		15		60
June	18		Purchase		55		40
June	18		Purchase return		10		40
June	25		Sale		54		65
June	28		Purchase		35		43

	LIFO	FIFO	AVERAGE-COST
The ending inventory	$Enter a dollar amount	$Enter a dollar amount	$Enter a dollar amount
The cost of goods sold	$Enter a dollar amount	$Enter a dollar amount	$Enter a dollar amount
Gross profit	$Enter a dollar amount	$Enter a dollar amount	$Enter a dollar amount

Calculate gross profit rate under each of the following methods: (1) LIFO., (2) FIFO and (3) average-cost. (Round answers to 1 decimal place, e.g. 51.2%.)

		LIFO		FIFO		AVERAGE-COST
Gross profit rate		Enter percentages	%		Enter percentages	%		Enter percentages	%

Compare the results for the three cost flow assumptions and answer the following questions.

In this period of rising prices, Select a cost flow assumption                                                                      FIFOAverage-costLIFO gives the highest cost of goods sold and the Select an option                                                                      highestlowest gross profit.
Select a cost flow assumption                                                                      FIFOLIFOAverage-cost gives the lowest cost of goods sold and the Select an option                                                                      highestlowest gross profit.

Average-cost gives results that fall Select an option                                                                      abovebelowbetween those for LIFO and FIFO.

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