Question

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Warnerwoods Company uses a perpetual inventory system. It entered into the following purchases and sales transactions for March.

Date

Activities

Units Acquired at Cost

Units Sold at Retail

Mar.

1

Beginning inventory

230

units

@ $53.60 per unit

Mar.

5

Purchase

290

units

@ $58.60 per unit

Mar.

9

Sales

390

units

@ $88.60 per unit

Mar.

18

Purchase

150

units

@ $63.60 per unit

Mar.

25

Purchase

280

units

@ $65.60 per unit

Mar.

29

Sales

260

units

@ $98.60 per unit

Totals

950

units

650

units

Perpetual LIFO: Goods Purchased Cost of Goods Sold Inventory Balance Date # of units Cost per unit # of units sold Cost per unit Cost of Goods Sold # of units Cost per unit Inventory Balance March 1 230 @ $53.60 = $12,328.00 March 5 March 9 March 18 March 25 March 29 Totals $0.00

Answer 1

Under LIFO ,units acquired last are sold first .

Perpetual LIFO
DATE	GOODS PURCHASED			COST OF GOODS SOLD			INVENTORY BALANCE
	Units	unit cost	Total	Units	unit cost	Total	Units	unit cost	Total
Mar 1							230	53.6	12328
Mar 5	290	58.6	16994				230	53.6	12328
							290	58.6	16994
Mar 9				290	58.6	16994
				100	53.6	5360	230-100=130	53.6	6968
Mar18	150	63.6	9540				130	53.6	6968
							150	63.6	9540
Mar 25	280	65.60	18368				130	53.6	6968
							150	63.6	9540
							280	65.60	18368
Mar 29				260	65.60	17056	130	53.6	6968
							150	63.6	9540
							280-260=20	65.6	1312
Total						39410			6968+9540+1312= 17820