question archive FIFO and LIFO Costs Under Perpetual Inventory System The following units of an item were available for sale during the year: Beginning inventory 34 units at $48 Sale 31 units at $72 First purchase 17 units at $49 Sale 13 units at $73 Second purchase 29 units at $50 Sale 27 units at $75 The firm uses the perpetual inventory system, and there are 9 units of the item on hand at the end of the year

FIFO and LIFO Costs Under Perpetual Inventory System The following units of an item were available for sale during the year: Beginning inventory 34 units at $48 Sale 31 units at $72 First purchase 17 units at $49 Sale 13 units at $73 Second purchase 29 units at $50 Sale 27 units at $75 The firm uses the perpetual inventory system, and there are 9 units of the item on hand at the end of the year

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FIFO and LIFO Costs Under Perpetual Inventory System The following units of an item were available for sale during the year: Beginning inventory 34 units at $48 Sale 31 units at $72 First purchase 17 units at $49 Sale 13 units at $73 Second purchase 29 units at $50 Sale 27 units at $75 The firm uses the perpetual inventory system, and there are 9 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? Check My Work All work saved Save and Exit

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SOLUTION:

a. Total Cost of Ending Inventory according to FIFO = $ 450

b. Total Cost of Ending Inventory according to LIFO = $ 440

FIFO:

  Purchases COGS Balance Inventory
  Units per unit Total Units per unit Total Units per unit Total
Beginning             34 48 1632
                   
Sale       31 48 1488 3 48 144
                   
1st Purchase 17 49 833       3 48 144
              17 49 833
                   
Sale       3 48 144 7 49 343
        10 49 490      
                   
2nd Purchase 29 50 1450       7 49 343
              29 50 1450
                   
Sale       7 49 343 9 50 450
        20 50 1000      
                   
Total       71   3465 9   450

Ending Inventory = $ 450

LIFO:

  Purchases COGS Balance Inventory
  Units per unit Total Units per unit Total Units per unit Total
Beginning             34 48 1632
                   
Sale       31 48 1488 3 48 144
                   
1st Purchase 17 49 833       3 48 144
              17 49 833
                   
Sale       13 49 637 3 48 144
              4 49 196
                   
2nd Purchase 29 50 1450       3 48 144
              4 49 196
              29 50 1450
                   
Sale       27 50 1350 3 48 144
              4 49 196
              2 50 100
                   
Total       71   3475 9   440

Ending Inventory = $ 440

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