The inventory data for an item for November are: Using a perpetual system, what is the cost of the merchandise sold for November if the company uses LIFO?
A) $610
B) $600
C) $590
D) $580

Question

The inventory data for an item for November are:  Using a perpetual system, what is the cost of the merchandise sold for November if the company uses LIFO?
A) $610 
B) $600 
C) $590 
D) $580

Quizplus · Accepted Answer

LIFO (Last In First Out) assumes that the most recently purchased items are sold first, which means that the cost of goods sold would be calculated using the cost of the most recently purchased items first. 
Using the given inventory data, the cost of the merchandise sold for November would be:
6 units at $100 = $600 (since the most recent purchase was at $100 per unit)
Therefore, the correct choice is C, $590 is incorrect because it is not a possible total cost based on the given data, and $610 and $580 are incorrect because they do not match the calculated cost of goods sold.

The Inventory Data for an Item for November Are