Question

esa Company's inventory records show the following data for the month of September: Units Unit Cost...

esa Company's inventory records show the following data for the month of September: Units Unit Cost Inventory, September 1 100 $3.35 Purchases: September 8 450 3.50 September 18 350 3.70 A physical inventory on September 30 shows 250 units on hand. Calculate the value of ending inventory and cost of goods sold if the company uses LIFO inventory costing and a periodic inventory system.

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Answer #1

Value of Ending Inventry for 250 unit= $860

and Cost of Good Sold for 650 unit =$2345

Under Periodic Inventory system , Trasaction are updated at the end of the period , and the inventory are valued at the end of Period  .

LIFO stands for Last in first Out , under this method of Valuation , it is assume that the Last stock that comes in will be sold out first .
Statement of Inventory under LIFO method and Period Inventory system

Beginning Inventory , September 1 100 unit @$3.35 $335
Purchase
September 8 450unit @$3.50 $1575
September 18 350unit @$3.70 $1295

Sold
As per LIFO Method [email protected] $1295
[email protected] $1050
$2345
Ending Inventory [email protected] $525
[email protected] $335
$860

Working Note

Sold Unit = Beginng Invenory + Purchase - Ending Inventory

=100+800-250

=650 units

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