Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions.


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Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions. 1 answer below » Effect of inventory cost flow on ending inventory balance and gross margin Ross Sales had the following transactions for DVDs in 2010, its first year of operations. Jan. 20 Purchased 75 units @ $15 = $1,125 Apr. 21 Purchased 450 units @ $20 = 9,000 July 25 Purchased 300 units @ $23 = 6,900 Sept. 19 Purchased 100 units @ $26 = 2,600 During the year, Ross Sales sold 850 DVDs for $60 each. Required a. Compute the amount of ending inventory Ross would report on the balance sheet, assuming the following cost flow View complete question » Effect of inventory cost flow on ending inventory balance and gross margin Ross Sales had the following transactions for DVDs in 2010, its first year of operations. Jan. 20 Purchased 75 units @ $15 = $1,125 Apr. 21 Purchased 450 units @ $20 = 9,000 July 25 Purchased 300 units @ $23 = 6,900 Sept. 19 Purchased 100 units @ $26 = 2,600 During the year, Ross Sales sold 850 DVDs for $60 each. Required a. Compute the amount of ending inventory Ross would report on the balance sheet, assuming the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average. b. Compute the difference in gross margin between the FIFO and LIFO cost flow assumptions. View less » Jul 24 2014 07:51 AM

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