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A company had the following purchases and sales during its first year of operations: Purchases Sales January: 11 units at...

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Accounting

A company had the following purchases and sales during its firstyear of operations:

PurchasesSales
January:11 units at $1357 units
February:21 units at $1405 units
May:16 units at $1459 units
September:13 units at $1508 units
November:11 units at $15514 units

On December 31, there were 29 units remaining in endinginventory. Using the Perpetual LIFO inventory valuation method,what is the cost of the ending inventory? (Assume all sales weremade on the last day of the month.)

Answer & Explanation Solved by verified expert
3.6 Ratings (674 Votes)

Cost of Ending Inventory = $4,095
Workings:
LIFO - Perpetual # of units    (A) Cost per unit Cost of goods available for sale # of units sold               (B) Cost per unit Cost of goods sold # of units in ending inventory      (A) - (B) Cost per unit Ending Inventory
January 11 $        135 $    1,485 7 $        135 $        945 4 $        135 $        540
February 21 $        140 $    2,940 5 $        140 $        700 16 $        140 $    2,240
May 16 $        145 $    2,320 9 $        145 $    1,305 7 $        145 $    1,015
September 13 $        150 $    1,950 8 $        150 $    1,200 2 $        150 $        300
3 $        150 $        450
November 11 $        155 $    1,705 11 $        155 $    1,705 0 $        155 0
Total 72 $ 10,400 43 $    6,305 29 $    4,095

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