Swifty Distribution markets CDs of numerous performing artists. At the beginning of March, Swifty had in beginning inventory 3,900 CDs with a unit cost of $7. During March, Swifty made the following purchases of CDs. March 5 March 13. 4,875 $8 6,825 @ $9 March 21 March 26 7,850 @ $10 5,800 @ $11 During March 21,000 units were sold. Swifty uses a periodic inventory system. Which cost flow method results in (1) the highest inventory amount for the balance sheet and (2) the highest cost of goods sold for the income statement?
Swifty Distribution markets CDs of numerous performing artists. At the beginning of March, Swifty had in beginning inventory 3,900 CDs with a unit cost of $7. During March, Swifty made the following purchases of CDs. March 5 March 13. 4,875 $8 6,825 @ $9 March 21 March 26 7,850 @ $10 5,800 @ $11 During March 21,000 units were sold. Swifty uses a periodic inventory system. Which cost flow method results in (1) the highest inventory amount for the balance sheet and (2) the highest cost of goods sold for the income statement?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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![Swifty Distribution markets CDs of numerous performing artists. At the beginning of March, Swifty had in beginning inventory
3,900 CDs with a unit cost of $7. During March, Swifty made the following purchases of CDs.
March 5
March 13
(1)
4,875 @ $8
6,825 @ $9
(2)
During March 21,000 units were sold. Swifty uses a periodic inventory system.
✓
Which cost flow method results in (1) the highest inventory amount for the balance sheet and (2) the highest cost of goods sold for
the income statement?
FIFO
LIFO
March 21
Average-cost
March 26
eTextbook and Media
7,850
$10
5,800 @ $11
produces the highest inventory amount for the balance sheet, $
produces the highest cost of goods sold on the income statement, $](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F18ac2d17-dc78-440b-a400-fc7585280576%2F902aea2f-e142-4951-97d4-8d72f1825dce%2Fcw3w2s7_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Swifty Distribution markets CDs of numerous performing artists. At the beginning of March, Swifty had in beginning inventory
3,900 CDs with a unit cost of $7. During March, Swifty made the following purchases of CDs.
March 5
March 13
(1)
4,875 @ $8
6,825 @ $9
(2)
During March 21,000 units were sold. Swifty uses a periodic inventory system.
✓
Which cost flow method results in (1) the highest inventory amount for the balance sheet and (2) the highest cost of goods sold for
the income statement?
FIFO
LIFO
March 21
Average-cost
March 26
eTextbook and Media
7,850
$10
5,800 @ $11
produces the highest inventory amount for the balance sheet, $
produces the highest cost of goods sold on the income statement, $
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