Question

ABC Company employs a periodic inventory system and sells its inventory to
customers for $23 per unit. ABC Company reported the following inventory
information for the month of May:

May 1    Beginning inventory 4,200 units @ $9 cost per unit
May 6    Purchased 2,000 units @ $12 cost per unit
May 8    Sold 3,000 units
May 13   Purchased 4,000 units @ $8 cost per unit
May 18   Sold 2,100 units
May 21   Purchased 2,500 units @ $6 cost per unit
May 28   Sold 2,200 units
May 30   Purchased 2,300 units @ $17 cost per unit

ABC Company reported operating expenses of $26,100 for May and they had a
tax rate of 43%.

Calculate the amount of net income shown on ABC Company's income statement
for May using the LIFO method.

Answer 1

Net income = $38,589

Working

Income statement
Net sales	$ 167,900.00
Cost of goods sold	$     74,100.00
Gross profit	$     93,800.00
Operating expense	$     26,100.00
Income before tax	$     67,700.00
Income tax expense	$     29,111.00
Net income	$     38,589.00

.

	Units	Cost per unit	value
Beginning Balance	4200	$                     9.00	$ 37,800
Purchases
	2000	$                   12.00	$ 24,000
	4000	$                     8.00	$ 32,000
	2500	$                     6.00	$ 15,000
	2300	$                   17.00	$ 39,100
Total	15000		$ 147,900

.

LIFO
Total Units Available for sale		15000
Units Sold		7300
Closing Stock in Units		7700
Valuation
Ending Inventory	4200	@	$               9.00	$ 37,800
	2000	@	$             12.00	$ 24,000
	1500	@	$               8.00	$ 12,000
Value Of Ending Inventory				$            73,800
Cost of Goods sold	147900 minus 73800			$            74,100