Question

In: Accounting

A company reports the following beginning inventory and two purchases for the month of January. On...

A company reports the following beginning inventory and two purchases for the month of January. On January 26, the company sells 260 units. Ending inventory at January 31 totals 120 units. Units Unit Cost Beginning inventory on January 1 230 $ 2.10 Purchase on January 9 50 2.30 Purchase on January 25 100 2.44 Required: Assume the perpetual inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on LIFO.

Solutions

Expert Solution

  • Working

Perpetual LIFO

Cost of Goods available for sale

Cost of Goods Sold – Jan 26

Inventory Balance

Units

Cost/unit

COG for sale

Units sold

Cost/unit

COGS

Units

Cost/unit

Ending inventory

Beginning Inventory

230

$               2.10

$          483.00

110

$               2.10

$          231.00

120

$             2.10

$          252.00

Purchases:

09-Jan

50

$               2.30

$          115.00

50

$               2.30

$          115.00

0

$             2.30

$                    -  

25-Jan

100

$               2.44

$          244.00

100

$               2.44

$          244.00

0

$             2.44

$                    -  

TOTAL

380

$          842.00

260

$          590.00

120

$          252.00

  • Cost of ending Inventory of 120 units = $ 252
  • Answer = $ 252

ekkarill92 answered 2 years ago
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