Question

June Corp. sells one product and uses a perpetual inventory system. The beginning inventory consisted of 80 units that cost $20 per unit. During the current month, the company purchased 480 units at $20 each. Sales during the month totaled 360 units for $43 each. What is the cost of goods sold using the LIFO method

Answer 1

$7,200

Step-by-step explanation:

The LIFO method of inventory valuation is one in which the last set of inventory items purchased are the first to be sold. This system may not be prudent where the items of inventory are perishable.

Given that sales during the month totaled 360 units, these must have been part of the items purchased during the month at $20 each. Hence, cost of goods sold

= 360 * $20

= $7,200

Answer 2

$7200

Step-by-step explanation:

LIFO means last in, first out. It means the last purchased inventory are the first to be sold.

The cost of goods sold = 360 x $20 = $7200

I hope my answer helps you