Question

Alta Ski Company's inventory records contained the following information regarding its latest ski model. The company uses a periodic inventory system.

Beginning inventory, January 1, 2018	1,100	units @ $75 each
Purchases:
January 15	2,300	units @ $90 each
January 21	2,100	units @ $95 each
Sales:
January 5	1,050	units @ $115 each
January 22	1,450	units @ $125 each
January 29	900	units @ $130 each
Ending inventory, January 31, 2018	2,100	units

Required:
1a. Which method, FIFO or LIFO, will result in the highest cost of goods sold figure for January 2018?
1b. Which method will result in the highest ending inventory balance?
2. Compute cost of goods sold for January and the ending inventory using both the FIFO and LIFO methods.

Answer 1

1 The highest cost of goods sold is result in by LIFO method

1 b) highest ending inventory represent by FIFO method