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C7-1 (Algo) Computing and Evaluating Financial Statement Effects of Alternative Inventory Costing Methods (Chapters 2...

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C7-1 (Algo) Computing and Evaluating Financial Statement Effects of Alternative Inventory Costing Methods (Chapters 2 and 7) [LO 2-5, LO 7-3] [The following information applies to the questions displayed below.] You have been given responsibility for overseeing a bank's small business loans division. The bank has included loan. covenants requiring a minimum current ratio of 1.30 in all small business loans. When you ask which inventory costing method the covenant assumes, the previous loans manager gives you a blank look. To explain to him that a company's inventory costing method is important, you present the following balance sheet information. You ask the former loans manager to find amounts for (a),(b), ( (c). and (d) assuming the company began the year with 3 units of inventory at a unit cost of $12, then purchased 6 units at a cost of $13 each, and finally purchased 4 units at a cost of $17 each. A year-end inventory count determined that 2 units are on hand. 4. Determine the current ratios using (i) FIFO, (ii) Weighted Average, and (iil) LIFO. (Round your answers to 2 decimal places.)

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