Question

Required information [The following information applies to the questions displayed below. A company reports the following beginning inventory and two purchases for the month of January. On January 26, the company sells 270 units. Ending inventory at January 31 totals 130 units. Beginning inventory on January 1 Purchase on January 9 Purchase on January 25 Units 240 60 100 Unit Cost $ 2.20 2.40 2.54 Assume the periodic inventory system is used. Determine the costs assigned to ending inventory when costs are assigned based on the LIFO method.

Answer 1

Solution:

Computation of ending inventory and cost of goods sold under Periodic LIFO
	Goods Available for sale	Cost of goods sold	Ending Inventory
	No. of Units	Cost Per unit	Cost of Goods Available for Sale	No. of Units sold	Cost Per unit	Cost of Goods sold	Ending Inventory Units	Cost per unit	Ending Inventory Cost
Beginning Inventory	240	$2.20	$528.00	110	$2.20	$242.00	130	$2.20	$286.00
Purchases:
9-Jan	60	$2.40	$144.00	60	$2.40	$144.00	0
25-Jan	100	$2.54	$254.00	100	$2.54	$254.00	0
Total	400		$926.00	270		$640.00	130		$286.00