Yang Corporation uses the periodic inventory system. The following sales and purchases of the same product were made during 20×1 at Yang Corporation. The opening inventory consisted of 50 units at $2 each.
$ per unit
*for specific identification, sold 50 units of opening inventory and 200 units of March 15 purchase
**for specific identification, sold 500 units of June 15 purchase
1. Calculate cost of goods sold and the cost of ending inventory under FIFO, LIFO, specific identification, and weighted average inventory cost flow assumptions. Use the student template #1
2. Calculate and compare the effect on profit of the four inventory cost flow assumptions.
3. The president wants to maximize the company’s net income this year. Write a memo to your immediate supervisor suggesting which inventory method is recommended in accordance with Generally Accepted Accounting Principles (GAAP). Give reasons to support your recommendation.
Your memo should be at least one page and must include the title and reference pages. In addition, your paper must be formatted according to the CSU-Global Guide to Writing and APA Requirements. Submit Parts 1 and 2 in the provided spreadsheet. Submit part 3 in a Word document.
Each assignment must include a title page and reference page. Review the grading rubric to understand how you will be graded on this assignment. Reach out to your instructor if you have questions about the assignment.
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