FIFO and LIFO Costs Under Perpetual Inventory System The following units of a pa
ID: 2459881 • Letter: F
Question
FIFO and LIFO Costs Under Perpetual Inventory System The following units of a particular item were available for sale during the year: Beginning inventory 38 units @ $42 Sale 9 units @ $67 First purchase 40 units @ $45 Sale 12 units @ $67 Second purchase 18 units @ $48 Sale 60 units @ $68 The firm uses the perpetual inventory system, and there are 15 units of the item on hand at the end of the year. a. What is the total cost of the ending inventory according to FIFO? $ b. What is the total cost of the ending inventory according to LIFO? $
Explanation / Answer
a. What is the total cost of the ending inventory according to FIFO=15 units*48=$720.
b. What is the total cost of the ending inventory according to LIFO=15*42=$630.
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