In: Accounting
Windsor, Inc. has the following inventory data:
July 1 | Beginning inventory | 26 units at $5.20 | ||
5 | Purchases | 103 units at $5.70 | ||
14 | Sale | 69 units | ||
21 | Purchases | 52 units at $6.20 | ||
30 | Sale | 48 units |
Assuming that a perpetual inventory system is used, what is the
value of ending inventory on a LIFO basis for July?
LIFO Perpetual Inventory Card for the month of July | ||||||
Date | Purchase | Sale | Balance | |||
Jul-01 | Beggining Inventory | ( 26 units X $ 5.20 ) | $ 135.20 | |||
Jul-05 | ( 103 units X $ 5.70 ) | $ 587.10 | - | - | ( 26 units X $ 5.20 ) | $ 135.20 |
( 103 units X $ 5.70 ) | $ 587.10 | |||||
Jul-14 | - | - | ( 69 units X $ 5.70 ) | $ 393.30 | ( 26 units X $ 5.20 ) | $ 135.20 |
( 34 units X $ 5.70 ) | $ 193.80 | |||||
Jul-21 | ( 52 units X $ 6.20 ) | $ 322.40 | - | - | ( 26 units X $ 5.20 ) | $ 135.20 |
( 34 units X $ 5.70 ) | $ 193.80 | |||||
( 52 units X $ 6.20 ) | $ 322.40 | |||||
Jul-30 | - | - | ( 48 units X $ 6.20 ) | $ 297.60 | ( 26 units X $ 5.20 ) | $ 135.20 |
( 34 units X $ 5.70 ) | $ 193.80 | |||||
( 4 units X $ 6.20 ) | $ 24.80 | |||||
Total | $ 909.50 | $ 690.90 | $ 353.80 | |||
Therefore, Value of ending Inventory on a LIFO basis for July is $ 353.80. | ||||||
In Last In Last Out ( LIFO ) method of Inventory valuation assumes that the last cost incurred to purchase merchandise or the direct materials are the first costs charged against revenues. |