Glasgow Enterprises started the period with 80 units in beginning inventory that cost $7.50 each.During the period,the company purchased inventory items as follows:
Glasgow sold 220 units after purchase 3 for $17.00 each.
-What is Glasgow's ending inventory under LIFO?
A)$2,730
B)$2,460
C)$2,220
D)$1,950

Question

Glasgow Enterprises started the period with 80 units in beginning inventory that cost $7.50 each.During the period,the company purchased inventory items as follows:
  Glasgow sold 220 units after purchase 3 for $17.00 each.
-What is Glasgow's ending inventory under LIFO?
A)$2,730 
B)$2,460 
C)$2,220 
D)$1,950

Quizplus · Accepted Answer

The last-in,first-out (LIFO)cost flow method requires that the cost of the items purchased last be charged to cost of goods sold.
Units in ending inventory = 80 units + 400 units purchased - 220 units sold = 260
Cost of goods sold = (80 × $7.50)+ (180 × $9.00)= $2,220

Glasgow Enterprises Started the Period with 80 Units in Beginning