Question

F8i-G2 Company uses the LIFO inventory costing method. The
company had a beginning inventory of 1,840 units that cost
$13.40 each. Purchases were made throughout the most recent
year as follows:

   March:     2,100 units purchased at $15.80 per unit
   June:        900 units purchased at $12.30 per unit
   August:    1,400 units purchased at $16.65 per unit
   October:     800 units purchased at $14.70 per unit

During the most recent year, 4,800 units were sold to customers
at a selling price of $21.00 each. Operating expenses for the
most recent year amounted to $1,300 and the income tax rate was
30%.

Calculate the net income reported by F8i-G2 Company during
the most recent year.

Answer 1

Net income = $18,550

Working

	Sales	Cost of Goods sold	Gross profit	Operating Expenses	Income before tax	Income tax expense	Net income
LIFO	$ 100,800	$ 73,000	$           27,800	$              1,300	$   26,500	$          7,950	$ 18,550

..

LIFO
Total Units Available for sale		7040
Units Sold		4800
Closing Stock in Units		2240
Valuation
Ending Inventory	1840	@	$             13.40	$ 24,656
	400	@	$             15.80	$ 6,320
Value Of Ending Inventory				$            30,976
Cost of Goods sold	103976 minus 30976			$            73,000

.

	Units	Cost per unit	value
Beginning Balance	1840	$                   13.40	$ 24,656
Purchases
	2100	$                   15.80	$ 33,180
	900	$                   12.30	$ 11,070
	1400	$                   16.65	$ 23,310
	800	$                   14.70	$ 11,760
Cost of goods available for sale	7040		$ 103,976