A company had the following purchases and sales during its first year of operati

Question

A company had the following purchases and sales during its first year of operations 12 Purchases Sales Januarys 21 units at $195 15 units February: 31 units at $200 18 units 26 units at $205 22 units September: 23 units at $210 21 units Novembers 21 units at $215 22 units On December 31, there were 24 units remaining in ending inventory Using the Perpetual LIFO inventory valuation method, what is the cost of the ending inventory? (Assume all sales were made on the last day of the month,) Mutiple Choice $10,389 $4,800 $9.951 2 3 4 5 6 8 9 0

Explanation / Answer

ans)

jan 1 21 195 4095 15 195 2925 6 195 1170

Feb 31 200 6200 18 200 3600 6 195 1170

13 200 2600

may 26 205 5330 22 205 4510 6 195 1170

13 200 2600

4 205 820

Sep 23 210 4830 21 210 4410 6 195 1170

13 200 2600

4 205 820

2 210 420

Nov 21 215 4515 21 215 4515 6 195 1170

1 210 210 13 200 2600

4 205 820

1 210 210

Cost of ending inventory = 1170 + 2600 + 820 +210 = 4800

Date Purchases sales    Balance Units Unit Cost Total Units Unit Cost Total Units Unit Cost Total

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