Beginning inventory, purchases, and sales for Item Gidget are as follows: Sept. 1 Inventory 80 units at $175

Beginning inventory, purchases, and sales for Item Gidget are as follows:

Sept. 1 Inventory 80 units at $175

10 Sale 65 units

18 Purchase 75 units at $180

27 Sale 70 units

Assuming a perpetual inventory system and using the last-in, first-out (LIFO) method, determine (a) the cost of merchandise sold on September 27 and (b) the inventory on September 30.

Answer:

a. Cost of merchandise sold (September 27): $12,600 = (70 units × $180) b. Inventory, September 30: 15 units @ $175 $2,625 5 units @ $180 900 20 $3,525

Assume that the business in Exercise 7-3 maintains a perpetual inventory system, costing by the last-in, first-out method

Assume that the business in Exercise 7-3 maintains a perpetual inventory system, costing by the last-in, first-out method. Determine the cost of merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4.

Answer:

Unit Total Unit Total Unit Total Quantity Cost Cost Quantity Cost Cost Quantity Cost Cost Apr. 1120 26 3,120 1090 26 2,340 30 26 780 15 140 28 3,92030 26 780 140 28 3,920 20110 28 3,080 30 26 780 30 28 840 2430 28 840 20 26 520 10 26 260 30 160 30 4,80020 26 520 160 30 4,800 30  Balances6,5205,320