Question - Johnson Company reports the following for the month of June.
|
Date
|
Explanation
|
Units
|
Unit Cost
|
Total Cost
|
|
June 1
|
Inventory
|
225
|
$5
|
$1,125
|
|
12
|
Purchase
|
525
|
6
|
3,150
|
|
23
|
Purchase
|
750
|
7
|
5,250
|
|
30
|
Inventory
|
280
|
|
|
(a) Compute the cost of the ending inventory and the cost of goods sold under (1) FIFO, (2) LIFO, and (3) average cost.
(b) Which costing method gives the highest ending inventory? The highest cost of goods sold? Why?
(c) How do the average-cost values for ending inventory and cost of goods sold relate to ending inventory and cost of goods sold for FIFO and LIFO?