Question

Assume Jones Manufacturing begins January with 10 units of inventory that cost $10 each. During January, the following purchases and goods sold were: Jan 5 Purchased 8 units at $11 7 Sold 11 units 15 Purchased 6 units at $12 30 Sold 15 units Using the LIFO inventory costing method and the perpetual system, how much is Costs of Goods Sold for the sale of January 7?

Answer 1

The correct answer is 111 :)

Answer 2

$118

Step-by-step explanation:

The computation of the cost of goods sold using the LIFO inventory costing method and the perpetual system is

Since 11 units are sold

So 8 units are taken at $11 from January 7

And, the remaining 3 units are taken from beginning inventory at $10

In mathematically,

= 8 units × $11 + 3 units × $10

= $88 + $30

= $118