Question

F8i-G2 Company uses the LIFO inventory costing method. The
company had a beginning inventory of 1,840 units that cost
$13.20 each. Purchases were made throughout the most recent
year as follows:

   March:     2,100 units purchased at $15.60 per unit
   June:        900 units purchased at $12.10 per unit
   August:    1,400 units purchased at $16.35 per unit
   October:     800 units purchased at $14.40 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 = $19,376

Working

	Sales	Cost of Goods sold	Gross profit	Operating Expenses	Income before tax	Income tax expense	Net income
LIFO	$      100,800	$                 71,820	$           28,980	$              1,300	$   27,680	$          8,304	$           19,376

.

	Units	Cost per unit	value
Beginning Balance	1840	$                   13.20	$ 24,288
Purchases
	2100	$                   15.60	$ 32,760
	900	$                   12.10	$ 10,890
	1400	$                   16.35	$ 22,890
	800	$                   14.40	$ 11,520
Cost of goods available for sale	7040		$ 102,348

.

LIFO
Total Units Available for sale		7040
Units Sold		4800
Closing Stock in Units		2240
Valuation
Ending Inventory	1840	@	$             13.20	$ 24,288
	400	@	$             15.60	$ 6,240
Value Of Ending Inventory				$            30,528
Cost of Goods sold	102348 minus 30528			$            71,820