[The following information applies to the questions displayed below.] The follow

Question

[The following information applies to the questions displayed below.] The following information pertains to Mason Company for 2016: Beginning inventory 144 units @ $ 44 Units purchased 414 units @ $ 66 Ending inventory consisted of 56 units. Mason sold 502 units at $132 each. All purchases and sales were made with cash. Operating expenses amounted to $3,900. 3.value: 3.00 pointsRequired information Required a. Compute the gross margin for Mason Company using the following cost flow assumptions: (1) FIFO, (2) LIFO, and (3) weighted average. (Round cost per unit to 3 decimal places and final answers to the nearest whole dollar amount.)

Explanation / Answer

ANS 1 Calculation of gross Margin for Mason Company Paricular Amount Amount Amount Fifo Lifo Weighted Average Sale           66,264           66,264           66,264 (502 X 132) Less :- Cost of goods sold*         (24,684)         (23,452)         (24,366) Less: Operating Expense           (3,900)           (3,900)           (3,900) Gross margin           37,680           38,912           37,998 * Calculation of Cost of goods sold for Mason Company in Case of Fifo method Quantity Rate Amount Opening inventory 144 44              6,336 Purchases 414 66 27,324 Closing stock 56 66 3,696 Cost of goods sold 24,684 Inventory valuation rate is 66 as in fifo method closing inventory will calculated from last purchase. * Calculation of Cost of goods sold for Mason Company in Case of Lifo method Quantity Rate Amount Opening inventory 144 44              6,336 Purchases 414 66 27,324 Closing stock 56 44 2,464 Cost of goods sold 23,452 Inventory valuation rate is 44 as in lifo method closing inventory will calculated from opening inventory. * Calculation of Cost of goods sold for Mason Company in Case of weighted average method Quantity Rate Amount Opening inventory 144 44 6,336 Purchases 414 66 27,324 Closing stock 56 60 3,378 Cost of goods sold 24,366 Inventory valuation rate is 60 as in weighted average method closing inventory will calculated amount of inventory available for sale divided by units inventory available for sale

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