Problem
Epperly Company Inc. had a beginning inventory of 100 units of Product MLN at a cost of $6 per unit. During the year, purchases were:
Feb. 20 605 units at $ 7 Aug. 12 400 units at $9
May 5 475 units at $ 8 Dec. 8 95 units at $10
Epperly Company's sales during the year totaled 1,495 units.
Task: Use the attached template to answer the following:
1. Determine the cost of goods available for sale.
2. Determine the ending inventory and the cost of goods sold under each of the assumed cost flow methods (FIFO, LIFO, and average cost). Prove the accuracy of the cost of goods sold under each method. (Round average unit cost to three decimal places.)
3. Which cost flow method results in the lowest inventory amount for the balance sheet?