Answer:
Instructions are listed below
Explanation:
Giving the following information:
June 1:
Inventory: 120 units for $5= $600
June 12:
Purchase: 370units for $6= $2,220
June 23:
Purchase: 200 units for $7= $1,400
June 30:
Ending Inventory 230 units
Units sold= 460
<u>Under FIFO method, the first units-in are the first to go out. Therefore, the ending inventory has the value of the last units purchased.</u>
<u />
Inventory= 200*7 + 30*6= $1,580
COGS= 120*5 + 340*6= $2,640
<u>Under LIFO method, the lasts units-in are the first out. </u>
Inventory= 120*5 + 110*6= $1,260
COGS= 260*6 + 200*7= $2,960
<u>Under the average cost method, we calculate an average buying price and then calculate the ending inventory and cost of goods sold:</u>
<u />
Average price= (5 +6 +7)/3= 6
Inventory= 230*6= $1,380
COGS= 460*6= $2,760
The highest ending inventory is from FIFO method.
