The Froto Company began business on January 3rd, 2020, when they sold stock for $80,000....
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The Froto Company began business on January 3rd, 2020, when they sold stock for $80,000. During 2020: On January 15th, Froto bought 1000 units of inventory at $20 each. On March 9th, Froto bought 1000 units of inventory at $25 each. On July 11th, Froto bought 1000 units of inventory at $30 each. On November 1st, Froto bought 1000 units of inventory at $40 each. On December 31st, Froto has 1300 units of inventory in the warehouse. Froto sold its merchandise at $49 each. Taxes are 25%. On December 31st, Froto has no payables or receivables. REQUIRED: a) If Froto uses FIFO, determine ending inventory, cost of goods sold, income, and ending cash. b) If Froto uses LIFO, determine ending inventory, cost of goods sold, income, and ending cash. c) How much would Froto have saved using LIFO instead of FIFO?
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