Sales during the year were 500 units.Beginning inventory was 250 units at a cost of $5 per unit.Purchase 1 was 400 units at $6 per unit.Purchase 2 was 200 units at $7 per unit. Cost of goods sold under the LIFO cost flow assumption (using a periodic inventory system)was:

Question

Quizplus · Accepted Answer

The LIFO cost flow assumption assumes that the most recently purchased units are the first to be sold. Therefore, the cost of goods sold would be the cost of the 200 units purchased at $7 per unit, plus the cost of the 300 units purchased at $6 per unit. This totals $3,200.

Sales During the Year Were 500 Units