Question 3: Suggested time 15 minutes: 15% points:
The following information is available for Flip Company:
Beginning inventory..600 units at $4.00
First purchase........900 units at $6.00
Second purchase....500 units at $7.20
Assume that Flip uses a periodic inventory system and that there are 700 units left at the end of the month.
Instructions: Compute the cost of ending inventory and Cost of Good Sold under the
a. LIFO method.
b. FIFO method.
c. Average-cost method