As an accountant for Lee Company, your supervisor gave you the following calculations of the gross profit for the first quarter:Prepare schedules computing the ending inventory ( in units and dollars) and proving the cost of goods sold shown here under each of the three alternatives. AlternativeSales ($50 per unit) Cost of Goods Sold Gross Profit$500,000500,000500,000$300,000272,000286,667A$200,000B228,000213,333The three alternative cost flow assumptions are FIFO, average, and LIFO (the alternatives are not necessarily pre-sented in this sequence). Lee uses the periodic inventory system. The computation of the cost of goods sold undercach alternative is based on the following data:Cost/Unit$2021UnitsInventory, January 1Purchase, January 10Purchase, February 15Purchase, March 1012,0004,0006,0008,0002223

Name: As an accountant for Lee Company, your supervisor gave you the followi
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Description: As an accountant for Lee Company, your supervisor gave you the following calculations of the gross profit for the first quarter:Prepare schedules computing the ending inventory ( in units and dollars) and proving the cost of goods sold shown here und

Inventory is a form of asset that is intended to be sold during normal business operations.…

Answered: Alternative Sales ($50 per unit) Cost…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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As an accountant for Lee Company, your supervisor gave you the following calculations of the gross profit for the first quarter:

Prepare schedules computing the ending inventory ( in units and dollars) and proving the cost of goods sold shown here under each of the three alternatives.

Alternative
Sales ($50 per unit) Cost of Goods Sold Gross Profit
$500,000
500,000
500,000
$300,000
272,000
286,667
A
$200,000
B
228,000
213,333
The three alternative cost flow assumptions are FIFO, average, and LIFO (the alternatives are not necessarily pre-
sented in this sequence). Lee uses the periodic inventory system. The computation of the cost of goods sold under
cach alternative is based on the following data:
Cost/Unit
$20
21
Units
Inventory, January 1
Purchase, January 10
Purchase, February 15
Purchase, March 10
12,000
4,000
6,000
8,000
22
23

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