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ID: 2556893 • Letter: C

Question

Chrome File Edit View History Bookmarks People Window Help 0??8%D Thu 1 Take a Test- Meosha Warner a Secure https://www.mathxl.com/Student/PlayerTest.aspx?testid- 1807477738centerwineyes This Question: 2 pts 16 of 34 (31 complete)Y Assume Nile.com began April with 14 units of inventory that oost a total of $266. During Apnil, Nile.com purchased and sold goods as tolows ?.8 Purchase 42units @ S20 14 Sale 35 units @$40 22 Purchase 28 units @$22 27 Sale42 units $40 Suppose Nile com used the LFO inventory cosing method and periodic inventory systern Usm the normation above doter ne Nle co 's cost of goods sold athee dane on O A. $133 O B. $154 oc. s1.568 nknown OD. $1,589 Solutior

Explanation / Answer

Answer is option (D) $1589

Explanation;

As we know that as per LIFO, latest purchased units are sold first. So let’s calculate cost of goods sold as per this rule;

First of all let’s calculate number of units sold;

Total units sold (35 units + 42 units) = 77 units

These 77 units will be issued as follow;

Date

Units Sold

Total cost

April 22

28 units @ $22 per unit

$616

April 8

42 units @ $20 per unit

$840

April 1

7 units @ $19 per unit

$133

Total cost of goods sold ($616 + $840 + $133)

$1589