Compute gross profit earned by the company

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Question - Perpetual: Alternative cost flows

Warnerwoods Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March.

Date

Activities

Units Acquired at Cost

Units Sold at Retail

Mar. 1

Beginning inventory

80 units @ $50.60 per unit

 

Mar. 5

Purchase

215 units @ $55.60 per unit

 

Mar. 9

Sales

 

240 units @ $85.60 per unit

Mar. 18

Purchase

75 units @ $60.60 per unit

 

Mar. 25

Purchase

130 units @ $62.60 per unit

 

Mar. 29

Sales

 

110 units @ $95.60 per unit

 

Totals

500 units

350 units

Required - Compute gross profit earned by the company for each of the four costing methods. For specific identification, the March 9 sale consisted of 55 units from beginning inventory and 185 units from the March 5 purchase; the March 29 sale consisted of 35 units from the March 18 purchase and 75 units from the March 25 purchase.

Reference no: EM132472333

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