Problem: The White Wove Corporation began operations in 2011. A summary of the firs quarter appears below:
Purchases:
January 2...............250 units...............$23,250
February 11............100 units...............$9,500
February 20.............400 units.........$38,400
March 21................200 units..............$19,600
March 27..................225 units..................$22,275
Other data:
January.....................200 sales in units sales price per unit $140 operating expenses $9,575
February.............225 sales in units sales price per unit $142 operating expenses $7,820
March.................350 sales in units sales price per unit $145 operating expenses $7,905
The White Wove Corporation used the FIFO perpetual inventory method and correctly computed an inventory value of $38,300 at the end of the first quarter.
Management is considering changing to a FIFO costing method.
It has also considered using a periodic system instead of the perpetual system presently being used.
You have been hired to assist management in making the decision.
What would you advise?
over 300 to 400 words