Perpetual Inventory Using LIFO Beginning inventory, purchases, and sales data fo

Question

Perpetual Inventory Using LIFO Beginning inventory, purchases, and sales data for prepaid cell phones for December are as follows: Inventory Purchases Sales Dec. 1 2,200 units at $24 Dec. 10 1,100 units at $26 Dec. 12 1,540 units Dec. 20 990 units at $28 Dec. 14 1,320 units Dec. 31 660 units a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of goods sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4. Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the Cost of Goods Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column.

Explanation / Answer

COGS for sale on Dec 12 = 1100*26= 28600$ + 440*24= 39160$

COGS for sale on Dec 14 = 1320*24= 31680$

COGS for sale on Dec 31 = 660*28= 18480$

Ending inventory = 440*24 + 330*28= 19,800$

Date Purchase/sale balance Dec 1 2200*24= 2200units Dec 10 1100*26= 3300units Dec 12 (1540) 1760 units Dec 14 (1320) 440 units Dec 20 990*28= 1430units Dec 31 (660) 770 units

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