Metro Computer Company had the following balances and transactions during 2014. $$\begin{array} { | l | l | }
\hline \text { Beginning inventory } & 100 \text { units at } \$ 75 \
\hline \text { March } 10 & \text { Sold } 50 \text { units } \
\hline \text { June } 10 & \text { Purchased } 200 \text { units at } \$ 80 \
\hline \text { October 30 } & \text { Sold } 150 \text { units } \
\hline
\end{array}$$
- What would the Cost of goods sold be as reported on the income statement at December 31,2014 if the perpetual Last-In,First-Out costing method is used? (Answers are rounded to the nearest dollar.)

Question

Metro Computer Company had the following balances and transactions during 2014. $$\begin{array} { | l | l | } 
\hline \text { Beginning inventory } & 100 \text { units at } \$ 75 \
\hline \text { March } 10 & \text { Sold } 50 \text { units } \
\hline \text { June } 10 & \text { Purchased } 200 \text { units at } \$ 80 \
\hline \text { October 30 } & \text { Sold } 150 \text { units } \
\hline
\end{array}$$
- What would the Cost of goods sold be as reported on the income statement at December 31,2014 if the perpetual Last-In,First-Out costing method is used? (Answers are rounded to the nearest dollar.)

Quizplus · Accepted Answer

Under the perpetual LIFO method, the last items added to inventory are the first ones to be sold. The cost of goods sold (COGS) calculation would be as follows: For the first sale of 50 units, all 50 units would come from the beginning inventory at $75 each, totaling $3,750. For the second sale of 150 units, 150 units would come from the most recent purchase of 200 units at $80 each, totaling $12,000. Adding these together, the COGS would be $3,750 (from the first sale) + $12,000 (from the second sale) = $15,750.

Metro Computer Company Had the Following Balances and Transactions During