Question

At the end of January, Mineral Labs had an inventory of 925 units, which cost $9 per unit to produce. During February the company produced 1,650 units at a cost of $13 per unit. a. If the firm sold 2,350 units in February, what was the cost of goods sold? (Assume LIFO inventory accounting.) b. If the firm sold 2,350 units in February, what was the cost of goods sold? (Assume FIFO inventory accounting.)

Answer 1

Answer:

A) Cost of goods sold= $27750

B) Cost of goods sold= $26850

Explanation:

Giving the following information:

Beginning inventory: 925 units; $9 each

Production: 1650 units; $13 each

A) The firm sold 2,350 units in February, what was the cost of goods sold? (LIFO)

1650 units at $13=  $21450

700 unit at $9= $6300

Cost of goods sold= $27750

B) The firm sold 2,350 units in February, what was the cost of goods sold? (FIFO)

925 units at $9= $8325

1425 units at $13= $18525

COGS= $26850