U5-5 Perpetual: Inventory costing with LIFO LO P1 A company reports the folowing

Question

U5-5 Perpetual: Inventory costing with LIFO LO P1 A company reports the folowing begiring inventory and purchases for the month of January On January 26, the compary sells 450 units 170 urits remain in ending inventory at January 31 Unit Cost Boginning inventory on January 1 4104.00 Purchase on January 9 Purthase on January 25 90 120 4.20 4.30 Required Asaume the perpetual invenbory system is used. Detarmine the costs assigred to ending inventery amounts to 2 decimal places) Perpetual LIFO units Coat per Cost of Coods sold Cost per Inventory il of Dabeunits un Sold January 1 410 400 1,84000 January 9 S 0.00 January 26 4201. $ 4.30- 4.00 400| “ | Totals

Explanation / Answer

Perpetual LIFO:

410 units * $4 = $1640

90 units * $4.20 = $378

410 units * $4 = $1640

90 units * $4.20 = $378

120 units * $4.30 = $516

120 units * $4.30 = $516

90 units * $4.20 = $378

240 units * $4 = $960

Date Cost of goods available for sale Cost of goods sold Ending inventory Jan 1 Beginning inventory 410 units * $4 = $1640 410 units * $4 = $1640 9 90 units * $4.20 = $378

410 units * $4 = $1640

90 units * $4.20 = $378

25 120 units * $4.30 = $516

410 units * $4 = $1640

90 units * $4.20 = $378

120 units * $4.30 = $516

26

120 units * $4.30 = $516

90 units * $4.20 = $378

240 units * $4 = $960

170 units * $4 = $680 31 170 units * $4 = $680 Cost of goods sold $1854 Ending inventory $680.

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