In: Accounting
Calculate the cost of goods sold and the cost of the ending inventory using the LIFO periodic cost flow assumption.
Sales 97 units at $ 18 per unit
Beginning inventory 88 units at $ 6 per unit
Purchases 58 units at $ 10 per unit
Calculate the cost of goods sold using the LIFO periodic cost flow assumption. Units x Cost per Unit = Total Cost Units from beginning inventory x = Units from purchase x = Cost of Goods Sold - LIFO method Calculate the cost of the ending inventory using the LIFO periodic cost flow assumption. ?(Enter 0's for any layers where there were no units? sold.) Units x Cost per Unit = Total Cost Units from beginning inventory x = Units from purchase x = Ending Inventory - LIFO method
cost of goods sold using LIFO periodic cost flow
units sold = 97 units.
under LIFO the goods which are purchased latest will be sold off.
so out of 97 units sold, 58 units will be from purchases @$10
remaining (97 - 58) units =>39 units will be from beginning inventory @$6.
cost of goods sold under LIFO = [58*$10] +[39*$6] =>$814.
now,
cost of ending inventory
units in ending inventory= beginning inventory + purchases - sales =>88 + 58 - 97 =>49 units.
under LIFO this 49 units from earliest purchases (i.e beginning inventory)
=> 49 units *$6
=>$294.