Santa Fe Tile Company had the following inventory purchases and sales during the month of May. The company uses the periodic inventory method. If Santa Fe uses LIFO costing, how much was the Ending inventory balance?

Question

Santa Fe Tile Company had the following inventory purchases and sales during the month of May. The company uses the periodic inventory method.  If Santa Fe uses LIFO costing, how much was the Ending inventory balance?

Quizplus · Accepted Answer

Using LIFO, the ending inventory will consist of the most recent purchases, which are:
4 units at $590 = $2,360
2 units at $420 = $840
1 unit at $220 = $220
Ending inventory balance = $2,360 + $840 + $220 = $2,480. Therefore, the correct answer is C.

Santa Fe Tile Company Had the Following Inventory Purchases and Sales