Question

Perpetual Inventory Using LIFO

Beginning inventory, purchases, and sales data for portable game players are as follows:

Apr. 1		Inventory	72 units @ $55
10		Sale	53 units
15		Purchase	91 units @ $58
20		Sale	51 units
24		Sale	15 units
30		Purchase	40 units @ $61

The business maintains a perpetual inventory system, costing by the last-in, first-out method.

Determine the cost of merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4.

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.

Answer 1

LIFO METHOD
		COST OF GOODS AVAILABLE FOR SALE	COST OF GOODS SOLD	ENDING INVENTORY
Date	Particulars	No. of Units	Cost Per unit	Total	No. of Units	Cost Per unit	Cost of Goods Sold	No. of Units	Cost Per unit	Ending invetory
Apr, 01	Beginning inventory							72	$               55	$3,960
Apr, 10	Sales				53	$               55	$2,915	19	$               55	$1,045
Apr, 15	Purchases	91	$                   58	$5,278				19	$               55	$1,045
								91	$               58	$5,278
Apr, 20	Sales				19	$               55	$1,045
					32	$               58	$1,856	59	$               58	$3,422
Apr, 24	Sales				15	$               58	$870	44	$               58	$2,552
Apr, 30	Purchases	40	$                   61	$2,440				44	$               58	$2,552
								40	$               61	$2,440
	Total Goods Available For sale	131		$7,718	119		$6,686	84		$4,992