The Following Information Relating to the Current Year Was Taken

question 66

Essay

The following information relating to the current year was taken from the records of Poole Company:
Required:a)Assuming that Poole uses the LIFO cost flow method, determine how much product cost would be allocated to cost of goods sold, and how much to inventory at the end of the year.b)Based on your results from part (a), calculate inventory turnover and average number of days to sell inventory.c)Assuming that Poole uses the FIFO cost flow method, determine how much product cost would be allocated to Cost of Goods sold, and how much to inventory at the end of the year.d)Based on your results from part (c), calculate inventory turnover and average number of days to sell inventory.e)Compare your results from parts (b)and (d). Do LIFO and FIFO give the same results for inventory turnover? Which is higher, and why?

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