Question

Eastview Company uses a perpetual LIFO inventory system, and has the following purchases and sales:

January 1 150 units were purchased at $9 per unit.
January 17 120 units were sold.
January 20 160 units were purchased at $11 per unit.
January 29 150 units were sold.

What is the value of cost of goods sold?

Answer 1

Answer:

The value of cost of goods sold is $2,730 as shown below

Explanation:

The sale of 120 units made on January 17 is valued at $1,080  (120*$9) taking from stock purchased last on January 1

The sale of 160 units on January 29 is valued at $1,650    (150 units*$11) taking the items purchased last on January 20

The cost of goods sold =$1,080+$1,650

Cost of goods sold=$2,730

The value of closing inventory=30*$9+10*$11

                                                   =$270+$110

                                                   =$380

Hence value of costs of good sold is $2,730 while closing inventory is valued at $380