Question

Albert Corporation provides the following information related to its merchandise inventory during the month of June...

Albert Corporation provides the following information related to its merchandise inventory during the month of June 2021:

June 1 Inventory on hand—2,000 units; cost $5.30 each.

June 8 Purchased 8,000 units for $5.50 each.

June 14 Sold 6,000 units for $12.00 each.

June 18 Purchased 6,000 units for $5.60 each.

June 25 Sold 7,000 units for $11.00 each.

June 28 Purchased 4,000 units for $5.80 each.

June 30 Inventory on hand—7,000 units.

Using calculations based on a perpetual inventory system, determine the inventory balance Albert would report in its June 30, 2021, balance sheet using last-in, first-out (LIFO):

A)37,100

B)39,300

C)38,100

D)40,200

Business   Accounting   
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Answer #1

B.

Under LIFO (Last In First Out) method, inventories are valued on the assumption that last purchased are expensed first.

In the above question, using LIFO inventory of Albert on June 30 would be valued as $39,300.

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