Question

Required information (The following information applies to the questions displayed below] During the year, TRC Corporation has the following inventory transactions. Number of Units . 56 Date Transaction Beginning Jan. 1 ". inventory Apr. 7 Purchase Jul.16 Purchase Oct. 6 Purchase NS Unit Cost Total Cost $48 $ 2,688 50 6,800 5310,918 54 6,264 $26,670 6, 90 IOS For the entire year, the company sells 442 units of inventory for $66 each. 2. Using LIFO, calculate ending inventory, cost of goods sold, sales revenue, and gross profit.

Answer 1

Ans 2 Last in, first out method (LIFO): In this method it is assumed that inventory which is purchased last will be sold first and the inventory will consist of old purchases. Cost of Good Available for sales Cost of Good Sold Ending inventory LIFO Cost of Goods Cost of No of Cost Per Ending No of Unit Cost Per Unit No of Unit Cost Per Unit Available for Sale Good Sold Unit Unit inventory Beginning Inventory 56 $48.00 $2,688 56 $48.00 $2,688 Purchases: Apr 07 $50.00 $6,800 120 $50.00 $6,000 $50.00 $800 Jul 16 206 $53.00 $10,918 206 $53.00 $10,918 $50.00 Oct 06 $54.00 $6,264 116 $54.00 $6,264 $53.00 $0 Total 514 $26,670 442 $23,182 $3,488 136 $0 116 72 Sales Revenue Gross Profit $29,172 $5,990 Sales Revenue Less:: Cost of Good old Gross Profit $29,172 [442 x $66] ($23,182) $5,990