Question

Check my 7 Part 2 of 3 Required information Use the following information for the Quick Study below. Trey Monson starts a merchandising business on December 1 and enters into the following three inventory purchases. Also, on December 15, Monson sells 23 units for $30 each. oints Purchases on December 7 Purchases on December 14 Purchases on December 21 13 units @ $12.00 cost 30 units @ $18.00 cost 23 units @ $22.00 cost eBook et Hint QS 5-11 Perpetual: Inventory costing with LIFO LO P1 Ask Required: Monson sells 23 units for $30 each on December 15. Monson uses a perpetual inventory system. Determine the costs assigned to the December 31 ending inventory when costs are assigned based on LIFO. References Perpetual LIFO: Goods purchased Cost of Goods Sold Inventory Balance Date # 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 December 7 December 14 December 15 December 21 Totals

Answer 1

Under LIFO method, it assumes that last purchased items are sold out first. So the ending inventory consists of units purchased first.

Date	Purchases	Cost of goods sold	Balance
Dec 7	13 units x $ 12 = $ 156		13 units x $ 12 = $ 156
Dec 14	30 units x $ 18 = $ 540		13 units x $ 12 = $ 156 30 units x $ 18 = $ 540
Dec 15		23 units x $ 18 = $ 414	13 units x $ 12 = $ 156 7 units x $ 18 = $ 126
Dec 21	23 units x $ 22= $ 506		13 units x $ 12 = $ 156 7 units x $ 18 = $ 126 23 units x $ 22 = $ 506

Ebding inventory = 156 + 126 + 506

Ending inventory = $ 788.

SUMMARY:

Ending inventory using LIFO method is $ 788.

Hence, $ 788 is the correct answer.