Question

FIFO and LIFO Costs Under Perpetual Inventory System The following units of an item were available for sale during the year: Beginning inventory 30 units at $40 Sale 21 units at $62 First purchase 30 units at $42 Sale 19 units at $64 Second purchase 26 units at $44 Sale 23 units at $64 The firm uses the perpetual inventory system, and there are 23 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? $fill in the blank 1 b. What is the total cost of the ending inventory according to LIFO?

Answer 1

The ending inventory using LIFO is $920.

The ending inventory using FIFO is $1,472.

What is the ending inventory?

LIFO means last in first out. It means that it is the last purchased inventory that is the first to be sold. Ending inventory would consist of first purchased inventory.

23 x $40 = $920

FIFO means first in, first out. It means that it is the first purchased inventory that is the first to be sold. Ending inventory would consist of last purchased items in inventory.

23 x $64 = $1,472

To learn more about FIFO, please check: https://brainly.com/question/294129

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