Question

Dec. 1	Beginning merchandise inventory	13	units @	$9	each
8	Sale	8	units @	$22	each
14	Purchase	16	units @	$14	each
21	Sale	14	units @	$22	each

Requirement 2. Compute the cost of goods​ sold, cost of ending merchandise​ inventory, and gross profit using the LIFO inventory costing method.

Begin by computing the cost of goods sold and cost of ending merchandise inventory using the LIFO inventory costing method. Enter the transactions in chronological​ order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual​ record, calculate the quantity and total cost of merchandise inventory​ purchased, sold, and on hand at the end of the period. ​(Enter the oldest inventory layers​ first.)

	Purchases			Cost of Goods Sold			Inventory on Hand
		Unit	Total		Unit	Total		Unit	Total
Date	Quantity	Cost	Cost	Quantity	Cost	Cost	Quantity	Cost	Cost
Dec. 1
Dec. 8
Dec. 14
Dec. 21
Totals

Answer 1

Solution:

	Purchases			Cost of goods sold			Inventory
		Unit	Total		Unit	Total		Unit	Total
Date	Quantity	Cost	Cost	Quantity	Cost	Cost	Quantity	Cost	Cost
Dec. 1							13	$9.00	$117.00
Dec. 8				8	$9.00	$72.00	5	$9.00	$45.00
Dec. 14	16	$14.00	$224.00				5	$9.00	$45.00
							16	$14.00	$224.00
Dec. 21				14	$14.00	$196.00	5	$9.00	$45.00
							2	$14.00	$28.00
Totals				22		$268.00	7		$73.00

Gross profit = Sales - COGS = (22*$22) - $268 = $216