With LIFO, cost of goods sold is $780,000, and ending inventory is $180,000. If FIFO ending inventory is $260,000, how much is FIFO cost of goods sold?

Question

Quizplus · Accepted Answer

The difference in ending inventory between FIFO and LIFO is $80,000 ($260,000 - $180,000). Since FIFO results in higher ending inventory, it results in lower cost of goods sold by the same amount. Therefore, FIFO cost of goods sold is $780,000 - $80,000 = $700,000.

With LIFO, Cost of Goods Sold Is $780,000, and Ending