Problem
Kingbird, Inc. had a beginning inventory of 105 units of Product RST at a cost of $7 per unit. During the year, purchases were:
Feb 20 600 units @ $8
May 5 190 units @ $9
Aug 12 390 units @ $10
Dec 8 100 units @ $11
1. Determine the cost of goods available for sale.
2. Calculate average cost per unit.
3. Determine the ending inventory and the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average cost)
4. Which cost flow method results in the lowest inventory amount for the balance sheet?
5. The lowest cost of goods sold for the income statement?