Question

A company reports the following beginning Inventory and two purchases for the month of January. On January 26, the company sells 360 units. Ending Inventory at January 31 totals 130 units.

Units Unit Cost
Beginning inventory on January 1 320 $3.10
Purchase on January 9 70 3.30
Purchase on January 25 100 3.40
Required:
Assume the Perpetual Inventory system is used. Determine the costs assigned to ending Inventory when costs are assigned based on LIFO.

Answer 1

$439

Step-by-step explanation:

Perpetual Inventory method calculates the value of goods held after each transaction.

LIFO stands for First In First Out.

Calculation of cost assigned to ending Inventory - FIFO

30 units × $3.30 = $99

100 units × $3.40 = $340

Total = $439