Question

1. The beginning inventory of merchandise at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as follows:

   Date		Transaction	Number of Units		Per Unit		Total
   Apr. 3		Inventory	84		$375		$31,500
   8		Purchase	168		450		75,600
   11		Sale	113		1,250		141,250
   30		Sale	71		1,250		88,750
   May 8		Purchase	140		500		70,000
   10		Sale	84		1,250		105,000
   19		Sale	42		1,250		52,500
   28		Purchase	140		550		77,000
   June 5		Sale	84		1,315		110,460
   16		Sale	112		1,315		147,280
   21		Purchase	252		600		151,200
   28		Sale	126		1,315		165,690

   Required:

   1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 4, using the last-in, first-out method. Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the Cost of Merchandise Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column.

   Dunne Co. Schedule of Cost of Merchandise Sold LIFO Method For the three-months ended June 30
   	Purchases			Cost of Merchandise Sold			Inventory
   Date	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost
   Apr. 3								$	$
   Apr. 8		$	$
   Apr. 11					$	$
   Apr. 30
   May 8
   May 10
   May 19
   May 28
   June 5
   June 16
   June 21
   June 28
   June 30	Balances					$			$

   2. Determine the total sales, the total cost of merchandise sold, and the gross profit from sales for the period.

   Total sales	$
   Total cost of merchandise sold
   Gross profit	$

   3. Determine the ending inventory cost on June 30.
   $

Answer 1

Under LIFO ,units acquired last are sold first .

	Purchase quantity	COst of goods sold	Inventory at end
Date	# of units	unit cost	Total	# of units	unit cost	Total	# of units	unit cost	Total
Apr 3							84	375	31500
8	168	450	75600				84	375	31500
							168	450	75600
11				113	450	50850	84	375	31500
							168-113=55	450	24750
30				55	450	24750
				71-55=16	375	6000	84-16= 68	375	25500
May 8	140	500	70000				68	375	25500
							140	500	70000
10				84	500	42000	68	375	25500
							140-84= 56	500	28000
19				42	500	21000	68	375	25500
							56-42= 14	500	7000
28	140	550	7700				68	375	25500
							14	500	7000
							140	550	7700
June 5				84	550	46200	68	375	25500
							14	500	7000
							140-84= 56	550	30800
16				56	550	30800
				14	500	7000
				42	375	15750	68-42= 26	375	9750
21	252	600	151200				26	375	9750
							252	600	151200
28				126	600	75600	26	375	9750
							252-126=126	600	75600
Total						319950			9750+75600= 85350

2)Total sales :141250+88750+105000+52500+110460+147280+165690=810930

cost of merchandise sold = 319950

Gross profit =sales-cost of goods sold

          = 810930 -319950

          = 490980

3)cost of ending inventory = 9750+75600=85350