1. Effie Company uses a periodic inventory system. Details for the inventory account for the month of...

3.9 Ratings (592 Votes)



1	Closing Units	140

	LIFO, Last in First Out means closing units will be from Old Purchases
		Units	Rate	Amt
	Opening Inventory	140	5	700

	Answer is D

2	Closing Units	200

	LIFO, Last in First Out means closing units will be from Old Purchases
		Units	Rate	Amt		Value	Qty	Rate PU
	Jun-01	150	2.60	390	Jun-01	390	150	2.60
	Jun-10	50	2.93	146	Jun-10	585	200	2.93
		200		536

	Answer is B

3	Closing Units	200				Qty	Rate PU	Value
					Purc-1	18	45.00	810
	Cost of Goods will be:				Purc-2	31	47.00	1457
		Units	Rate	Amt	Purc-3	22	49.00	1078
	Purc-1	18	45	810		71		3345
	Purc-2	31	47	1457
	Purc-3	1	49	49
		50		2316

	Income Statement:
	Sales	3500	(50*70)
	Less: COGS	2316
	Gross	1184
	Less : Tax 30%	355
	Net Income	829

	Answer is D

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