Question

Shown below is activity for one of the products of Denver Office Equipment:

January 1 balance, 600 units @ $50 $30,000

Purchases:

      January 10: 600 units @ $55

      January 20: 1,200 units @ $58

Sales:

      January 12: 900 units

      January 28: 800 units

Required: Compute the January 31 ending inventory and cost of goods sold for January, assuming Denver uses LIFO and a perpetual inventory system.

Answer 1

	Purchases			Cost of goods sold			Ending inventory
Date	units	per unit	Amount	units	per unit	Amount	units	per unit	amount
1-Jan							600	50	30,000
10-Jan	600	55	33000				600	50	30,000
							600	55	33000
12-Jan				600	55	33000
				300	50	15,000	300	50	15,000
20-Jan	1,200	58	69600				300	50	15,000
							1,200	58	69600
28-Jan				800	58	46400	300	50	15,000
							400	58	23200
total						94400			38,200
	cost of goods sold				$94,400
	ending inventory				38,200