Reference no: EM132429513

Question - Assume that Gameland store bought and sold a line of dolls during December as follows:

Gameland uses the perpetual inventory system.

Dec. 1 Beginning merchandise inventory 14 units @ $11each

8 Sale 8 units @ $19 each 14

Purchase 16 units @ $13 each 21

Sale 14 units @ $19 each

Requirements -

1 Compute the cost of goods sold, cost of ending merchandise inventory, and gross profit using the FIFO inventory costing method.

2. Compute the cost of goods sold, cost of ending merchandise inventory, and gross profit using the LIFO inventory costing method.

3. Which method results in a higher cost of goods sold?

4. Which method results in a higher cost of ending merchandise inventory?

5. Which method results in a higher gross profit?