Respuesta :
Answer:
Instructions are listed below.
Explanation:
Giving the following information:
Purchases:
(1) 240 units at $7.
(2) 340 units at $9.
(3) 440 units at $10.
Assuming there are 140 units on hand at the end of the period.
A) FIFO (first-in, first-out)
Inventory= 140*10= $1,400
B) LIFO (last-in, first-out)
Inventory= 140*7= $980
The cost of the ending inventory of 140 units under FIFO is $1,400 while under the LIFO is $980.
Since there are 140 units on hand at the end of the period.
Using the FIFO method:
Cost of the ending inventory = 140 units * $10
Cost of the ending inventory = $1,400
Using the LIFO method:
Cost of the ending inventory = 140 units * $7
Cost of the ending inventory = $980
In conclusion, the cost of the ending inventory of 140 units under FIFO is $1,400 while under the LIFO is $980.
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