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FIFO vs LIFO Montana Cycles started July with 25 bicycles that cost $36 each. On

ID: 2458979 • Letter: F

Question

FIFO vs LIFO

Montana Cycles started July with 25 bicycles that cost $36 each. On July 16, Montana bought 35 bicycles at $60 each. On July 31, when the average cost per unit was $50.00, Montana sold 33 bicycles for $105 each. Montana's cost of goods sold under the FIFO, LIFO and weighted-average methods is summarized as follows: Which inventory costing method produced the lowest cost of goods sold? Which inventory costing method produced the highest cost of goods sold? If costs had been declining instead of rising, which inventory costing method would have produced the highest cost of goods sold? Which inventory costing method produced the lowest cost of goods sold? Which inventory costing method produced the highest cost of goods sold? If costs had been declining instead of rising, which inventory costing method would have produced the highest cost of goods sold?

Explanation / Answer

1. Fifo

2. Lifo

3. Fifo