Calculate the cost of goods sold and the cost of the ending inventory using the

Question

Calculate the cost of goods sold and the cost of the ending inventory using the LIFO periodic cost flow assumption.

Sales 97 units at $ 18 per unit

Beginning inventory 88 units at $ 6 per unit

Purchases 58 units at $ 10 per unit

Calculate the cost of goods sold using the LIFO periodic cost flow assumption. Units x Cost per Unit = Total Cost Units from beginning inventory x = Units from purchase x = Cost of Goods Sold - LIFO method Calculate the cost of the ending inventory using the LIFO periodic cost flow assumption. ?(Enter 0's for any layers where there were no units? sold.) Units x Cost per Unit = Total Cost Units from beginning inventory x = Units from purchase x = Ending Inventory - LIFO method

Explanation / Answer

cost of goods sold using LIFO periodic cost flow

units sold = 97 units.

under LIFO the goods which are purchased latest will be sold off.

so out of 97 units sold, 58 units will be from purchases @$10

remaining (97 - 58) units =>39 units will be from beginning inventory @$6.

cost of goods sold under LIFO = [58*$10] +[39*$6] =>$814.

now,

cost of ending inventory

units in ending inventory= beginning inventory + purchases - sales =>88 + 58 - 97 =>49 units.

under LIFO this 49 units from earliest purchases (i.e beginning inventory)

=> 49 units *$6

=>$294.

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