Question

Perpetual Inventory Using LIFO

Beginning inventory, purchases, and sales data for portable game players are as follows:

Apr. 1		Inventory	56 units @ $76
10		Sale	40 units
15		Purchase	68 units @ $79
20		Sale	39 units
24		Sale	12 units
30		Purchase	26 units @ $84

The business maintains a perpetual inventory system, costing by the last-in, first-out method.

Determine the cost of merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4.

Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the Cost of Merchandise Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column.

Answer 1

Correct Answer:

Perpetual LIFO
Date	Goods Purchased			Cost of Goods Sold			Inventory Balance
	# of Units	Cost Per Unit	Cost of Goods Available for sale	# of Units Sold	Cost per Unit	Cost of Goods Sold	# of Units	Cost per Unit	Inventory Balance
01-Apr							56	$          76.00	$       4,256.00
10-Apr				40	$             76.00	$      3,040.00	16	$          76.00	$       1,216.00
15-Apr	68	$               79.00	$         5,372.00				68	79	$       5,372.00
							16	$          76.00	$       1,216.00
20-Apr				39	$             79.00	$      3,081.00	29	$          79.00	$       2,291.00
							16	$          76.00	$       1,216.00
24-Apr				12	$             79.00	$          948.00	17	$          79.00	$       1,343.00
							16	$          76.00	$       1,216.00
30-Apr	26	$               84.00	$         2,184.00				26	$          84.00	$       2,184.00
							17	$          79.00	$       1,343.00
							16	$          76.00	$       1,216.00
				Cost of goods sold			Ending Inventory
Total				91		$      7,069.00	59		$       4,743.00

                                                                                                                                                                                          

End of answer.

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