Question

Inventory Costing Methods: Periodic LIFO (Appendix 6B)

Filimonov Inc. has the following information related to purchases and sales of one of its inventory items:

Date	Description	Units Purchased at Cost	Units Sold at Retail
June 1	Beginning Inventory	200 units @ $10 = $2,000
9	Purchase 1	300 units @ $12 = $3,600
14	Sale 1		400 units @ $25
22	Purchase 2	250 units @ $14 = $3,500
29	Sale 2		225 units @ $25

Assume that the company uses a periodic inventory system.

Required:

Calculate the cost of goods sold and the cost of ending inventory using the LIFO inventory costing method.

Cost of goods sold	$
Cost of ending inventory	$

Answer 1

Solution:

Total sales units = 225 +400 = 625 units

Hence, cost of goods sold = $7850

Cost of ending inventory = $1250