Inventory information for Part 311 of Carla Corp. discloses the following inform

Question

Inventory information for Part 311 of Carla Corp. discloses the following information for the month of June.

1. Assuming that the perpetual inventory method is used and costs are computed at the time of each withdrawal, what is the value of the ending inventory at LIFO?

$

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2.

Assuming that the perpetual inventory method is used and costs are computed at the time of each withdrawal, what is the gross profit if the inventory is valued at FIFO?

June 1 Balance 296 units @ $13 June 10 Sold 204 units @ $31 11 Purchased 801 units @ $15 15 Sold 495 units @ $32 20 Purchased 501 units @ $17 27 Sold 296 units @ $35

Explanation / Answer

1 The ending inventory at LIFO = (296-204)*13+(801-495)*15+(501-296)*17= $9271 2 Sales = (204*31)+(495*32)+(296*35)= $32524 Cost of goods sold=(296*13)+(699*15)= $14333 Gross Profit (FIFO) = 32524-14333 = $18191

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