Reference no: EM132674764

The following information relates to the inventory of Margaret's Megamart Ltd during December. Ignore GST. Date

                            Units          Units cost            Total cost               1/12

Beginning inventory   700            $ 12.00            $ 8,400                  10/12

Purchase                 500               12.60              6,300                    15/12

Purchase                 300                 13.20             3,960                  23/12

Purchase                  500                  14.00           7,000

Totals                      2,000                                   $25,660

Margaret's Megamart Ltd uses the periodic inventory system. A physical count on 31 December verified that 650 units were on hand.

Required:

Problem a) Determine the Ending inventory and Cost of Sales for the month of December, using the FIFO costing method.

Problem b) Determine the Ending inventory and Cost of Sales for the month of December, using the weighted average costing method.

Problem c) Which cost flow method(s) resulted in higher gross profit on sales? a higher ending inventory? Explain your results.