A company had 14 units of inventory at a cost of $18 each on July 1. On July 3, the company purchased 19 units at $19 each. On July 7, the company purchased 15 units at $20 each. On July 9, the company sold 36 units for $63 each. Given this information, determine the cost of the 12 units remaining in inventory after the July 9 sale using the LIFO periodic inventory method.
A)$673.
B)$697.
C)$228.
D)$240.
E)$216.

Question

Quizplus · Accepted Answer

Under the LIFO method, the last items purchased are the first to be sold. After selling 36 units, the remaining 12 units are from the first purchase (14 units at $18 each). Therefore, the cost of the remaining inventory is 12 units x $18 = $216.

A Company Had 14 Units of Inventory at a Cost