Starlight Company has inventory of 8 units at a cost of $200 each on October 1. On October 2, it purchased 20 units at $205 each. 11 units are sold on October 4.
-Using the LIFO perpetual inventory method, what amount will be reported in cost of goods sold for the 11 units that were sold?

Question

Starlight Company has inventory of 8 units at a cost of $200 each on October 1. On October 2, it purchased 20 units at $205 each. 11 units are sold on October 4. 
-Using the LIFO perpetual inventory method, what amount will be reported in cost of goods sold for the 11 units that were sold?

Quizplus · Accepted Answer

Under the LIFO perpetual inventory method, the last items purchased are the first to be sold. Therefore, the cost of goods sold for the 11 units sold on October 4 would include 11 units from the October 2 purchase at $205 each, totaling $2,255.

Starlight Company Has Inventory of 8 Units at a Cost