Purchases July 10 uly 20 Sales July 12 910 units uly 14 780 units July 31 390 un

Question

Purchases July 10 uly 20 Sales July 12 910 units uly 14 780 units July 31 390 units Inventory uly 1 1,300 units at $33 650 units at $35 595 units at $37 a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of merchandise sold for each sale and the inventory balance after each sale. Schedule of Cost of Merchandise Sold LIFO Method Prepaid Cel Phones Date Quantity July 1 Juy Purchases Unit Cost Purchases Total Quantity Cost Cost of Merchandise Sold Unit Cost Cost of Merchandise Sold Total Cost Inventory Quantity 1300 Inventory Unit Cost Inventory Total Cost Purchased Sold $33 S42900 650 35 22,750 1.300 42.900 10 650 35 22,750 July 12 Accounting num July 14 July 20 S85 37 July 31 July 31 Balances

Explanation / Answer

LIFO METHOD

Date

Quantity
Purchased

Purchases
Unit cost

Purchases
Total cost

Quantity
Sold

Cost of
merchandise
sold (unit)

Cost of
merchandise
sold

Inventory
Quantity

Inventory
Unit Cost

Inventory
Total Cost

Jul-01

1300

33

42900

Jul-10

650

35

22750

1300

33

42900

650

35

22750

Jul-12

650

35

22750

1040

33

34320

260

33

8580

Jul-14

780

33

25740

260

33

8580

Jul-20

585

37

21645

260

33

8580

585

37

21645

Jul-31

390

37

14430

260

33

8580

195

37

7215

Balances

44395

71500

15795

Inventory on Hand =

15795

Cost of goods sold =

71500

LIFO METHOD

Date

Quantity
Purchased

Purchases
Unit cost

Purchases
Total cost

Quantity
Sold

Cost of
merchandise
sold (unit)

Cost of
merchandise
sold

Inventory
Quantity

Inventory
Unit Cost

Inventory
Total Cost

Jul-01

1300

33

42900

Jul-10

650

35

22750

1300

33

42900

650

35

22750

Jul-12

650

35

22750

1040

33

34320

260

33

8580

Jul-14

780

33

25740

260

33

8580

Jul-20

585

37

21645

260

33

8580

585

37

21645

Jul-31

390

37

14430

260

33

8580

195

37

7215

Balances

44395

71500

15795

Inventory on Hand =

15795

Cost of goods sold =

71500

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