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FIFO and LIFO Costs Under Perpetual Inventory System The following units of an item were available...

FIFO and LIFO Costs Under Perpetual Inventory System The following units of an item were available for sale during the year:

Beginning inventory 20 units at $48

Sale 17 units at $72

First purchase 18 units at $51

Sale 6 units at $74

Second purchase 28 units at $53

Sale 13 units at $76

The firm uses the perpetual inventory system, and there are 30 units of the item on hand at the end of the year.

a. What is the total cost of the ending inventory according to FIFO? $ b. What is the total cost of the ending inventory according to LIFO?

Solutions

Expert Solution

STATEMENT SHOWING INVENTORY RECORD UNDER PERPETUAL FIFO METHOD
RECIEPTS COST OF GOODS SOLD BALANCE
DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $
a. 20 48 960
b. 17 48 816 3 48 144
c. 18 51 918 3 48 144
18 51 918
d. 3 48 144
3 51 153 15 51 765
e. 28 53 1484 15 51 765
28 53 1484
f. 13 51 663 2 51 102
28 53 1484
TOTAL 46 2402 36 1776 30 1586
STATEMENT SHOWING INVENTORY RECORD UNDER PERPETUAL LIFO METHOD
RECIEPTS COST OF GOODS SOLD BALANCE
DATE UNITS RATE AMOUNT $ UNITS RATE AMOUNT $ UNITS RATE AMOUNT $
a. 20 48 960
b. 17 48 816 3 48 144
c. 18 51 918 3 48 144
18 51 918
d. 6 51 306 3 48 144
12 51 612
e. 28 53 1484 3 48 144
12 51 612
28 53 1484
f. 13 53 689 3 48 144
12 51 612
15 53 795
TOTAL 46 2402 36 1811 30 1551

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