Question

Starlight Company has inventory of 8 units at a cost of $200 each on October 1. On October 2, it purchased 20 units at $205 each. 11 units are sold on October 4. Using the LIFO perpetual inventory method, what amount will be reported in cost of goods sold for the 11 units that were sold?

Answer 1

Answer:

$2,255

Explanation:

The computation of the cost of good sold using the LIFO method is shown below:

Data given in the question

On October 1 = 8 units at $200 each

On October 2 = 20 units at $205 each

And, 11 units are sold on October 4

So using the LIFO method, the cost of goods sold for 11 units is

= Number of units sold × price of each units

= 11 units × $205

= $2,255