Lewis Corporation

LEWIS CORPORATION

        Lewis Corporation had traditionally used the FIFO method of inventory valuation.  You are given the information shown in exhibit 1 on transaction during the year affecting  Lewis inventory account. (The purchases are in the sequence during the year.  The company uses a periodic inventory method).

EXHIBIT 1 Inventory Transaction 2005 – 2007

2005

Beginning balance                                                1,840 cartoons @ $ 20.00

Purchases                                                           600 cartoons @ $ 20.25

                                                                   800 cartoons @ $ 21.00

                                                                   400 cartoons @ $ 21.25

                                                                   200 cartoons @ $ 21.50

Sales                                                                2,820 cartoons @ $ 34.00

2006

Beginning balance                                                1,020 cartoons

Purchases                                                           700 cartoons @ $ 21.50

                                                                   700 cartoons @ $ 21.50                                                                                      700 cartoons @ $ 22.00

                                                                1,000 cartoons @ $ 22.25

Sales                                                                3,080 cartoons @ $ 35.75

2007

Beginning balance                                                1,040 cartoons

Purchases                                                        1,000 cartoons @ $ 22.50                                                                                   700 cartoons @ $ 22.75