CAPE Accounting Unit 2 · 2021 · Paper 2 · Question 1(b)
Compare the impact on the gross profit of an enterprise using the FIFO and LIFO methods during periods of inflation.
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- 1(a)(i)Outline THREE differences between the FIFO and the LIFO inventory valuation methods.[6 marks]
- 1(a)(ii)Compute EACH of the following costs at 30 May 2019 using the FIFO method: • Ending inventory cost • Cost of goods sold[8 marks]
- 1(a)(iii)Compute the gross profit for Trelawney Inc. using the FIFO method if the items sold during May were at a sales price of $11 per unit.[4 marks]
- 1(c)Outline the TWO main differences between 'cost allocation' and 'cost apportionment'.[4 marks]
- 1(d)Calculate the amount of overhead cost that will be assigned to EACH production department.[9 marks]
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