Question

Wildhorse Co. just began business and made the following four inventory purchases in June:

June 1 200 units $1300
June 10 250 units 1875
June 15 250 units 2025
June 28 200 units 1700
$6900

A physical count of merchandise inventory on June 30 reveals that there are 250 units on hand. Using the LIFO inventory method, the value of the ending inventory (rounded to whole dollar) on June 30 is

a.$1,350.
b.$1,620.
c.$2,580.
d.$2,850.

Answer 1

$1,975

Step-by-step explanation:

The computation of the ending inventory using the LIFO method is shown below:

But before that first we have to determine the cost per unit for June 1 and For June 10 i.e

June 1

= $1,300 ÷ 200 units

= $6.5 per unit

June 10

= $1,875 ÷ 250 units

= $7.5 per unit

Now the ending inventory units is 250 units so, ending inventory is

= 200 units × $6.5 per unit + (250 units - 200 units) × $7.5

= $1,300 + $675

= $1,975

This is the answer but the same is not provided in the given options