Question

The inventory data for an item for November are: Nov. 1 Inventory 20 units at $19 4 Sold 10 units 10 Purchased 30 units at $20 17 Sold 20 units 30 Purchased 10 units at $21 Using a perpetual system, what is the cost of the goods sold for November if the company uses LIFO?

Answer 1

Answer:

Cost of goods sold = $590

Explanation:

Under the last in first out (LIFO), inventories are priced using the price of the lastest batch in stock and then the next second latest batch and so on.

The cost of goods sold would be

Nov 4   -  10 × $19 = $190

Nov 17   -  20 × $20 = $400

Cost of sold =  190 + 400 = $590

Answer 2

Answer:

The cost of the goods sold was

4 Nov-Sold 10 units at $19

17 Nov- Sold 20 units at $20

Explanation:

LIFO Perpetual table is attached.  

The table shows purchases, sales and balance of each period.

The cost of the goods sold for November if the company uses LIFO

4 Nov-Sold 10 units at $19

17 Nov- Sold 20 units at $20

Download xlsx