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Sontag Appliance Co

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1. Sontag Appliance Co. uses a perpetual inventory system. Shown below are Sontag's beginning inventory of a particular product and purchases during the month of January Quantity Unit Cost Total Cost Beginning Inventory (Jan. 1) 2 $180 $360 Purchase (Jan. 6) 4 210 840 Purchase (Jan. 25) 4 215 860 10 $2,060 On January 23, Sontag sold five units of this product. Using the three flow assumptions listed below, determine (1) the cost of goods sold, and (2) the cost of the five units in inventory at January 31. Show your computations. a) LIFO b) FIFO c) Average cost

2. Firms use job order costing when their products are homogenous. True False