Assume all transactions are cash transactions

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Reference no: EM13932855

Dugan Sales had the following transactions for jackets in 2013, its first year of operations:

1801_264-B-M-A-I (1844).png

During the year, Dugan Sales sold 830 jackets for $40 each. 

Required: 

a. Compute the amount of ending inventory Dugan would report on the balance sheet, assuming the following cost flow assumptions: 
(1) FIFO, 
(2) LIFO, 
(3) Weighted average. 

b. Record the above transactions in general journal form and post to T-accounts using 
(1) FIFO, 
(2) LIFO, 
(3) Weighted average. 

Use a separate set of journal entries and T-accounts for each method. Assume all transactions are cash transactions. 

c. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions. 

Reference no: EM13932855

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