Simple Plan Enterprises uses a periodic inventory system. Itsrecords showed the following:
Inventory, December 31, using FIFO → 44 Units @ $17 = $748
Inventory, December 31, using LIFO → 44 Units @ $13 = $572
| Transactions in the Following Year | Units | Unit Cost | Total Cost |
| Purchase, January 9 | | 56 | | | 18 | | $ | 1,008 | |
| Purchase, January 20 | | 106 | | | 19 | | | 2,014 | |
| Sale, January 11 (at $41 per unit) | | 86 | | | | | | | |
| Sale, January 27 (at $42 per unit) | | 62 | | | | | | | |
|
Required:
- Compute the number and cost of goods available for sale, thecost of ending inventory, and the cost of goods sold under FIFO andLIFO.
- Compute the inventory turnover ratio under the FIFO and LIFOinventory costing methods.
- Does the inventory method used make a significant difference inthe inventory turnover ratio?
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