Hazelton Corporation uses a periodic inventory system and the LIFO method to value its inventory. The company began 2018 with $59,000 in inventory of its only product. The beginning inventory consisted of the following layers:

During 2018, 6,000 units were purchased at $8 per unit and during 2019, 7,000 units were purchased at $9 per unit. Sales, in units, were 7,000 and 12,000 during 2018 and 2019, respectively.
Required:
1. Calculate cost of goods sold for 2018 and 2019.
2. Disregarding income tax, determine the LIFO liquidation profit or loss, if any, for 2018 and 2019.

Question

Hazelton Corporation uses a periodic inventory system and the LIFO method to value its inventory. The company began 2018 with $59,000 in inventory of its only product. The beginning inventory consisted of the following layers:

During 2018, 6,000 units were purchased at $8 per unit and during 2019, 7,000 units were purchased at $9 per unit. Sales, in units, were 7,000 and 12,000 during 2018 and 2019, respectively.
Required:
1. Calculate cost of goods sold for 2018 and 2019.
2. Disregarding income tax, determine the LIFO liquidation profit or loss, if any, for 2018 and 2019.

Quizplus · Accepted Answer

The Answer of Hazelton Corporation uses a periodic inventory system and the LIFO method to value its inventory. The company began 2018 with $59,000 in inventory of its only product. The beginning inventory consisted of the following layers:

During 2018, 6,000 units were purchased at $8 per unit and during 2019, 7,000 units were purchased at $9 per unit. Sales, in units, were 7,000 and 12,000 during 2018 and 2019, respectively.
Required:
1. Calculate cost of goods sold for 2018 and 2019.
2. Disregarding income tax, determine the LIFO liquidation profit or loss, if any, for 2018 and 2019.

Hazelton Corporation Uses a Periodic Inventory System and the LIFO