Inventory records for Dunbar Incorporated revealed the following:
Dunbar sold 700 units of inventory during the month.Cost of goods sold assuming LIFO would be:

Question

Quizplus · Accepted Answer

Since Dunbar sold 700 units of inventory, we assume that they sold the most recently purchased units first, using the LIFO (last-in, first-out) method of inventory costing. To calculate the cost of goods sold, we need to multiply the number of units sold by the cost per unit of the most recent purchases. Assuming that the cost per unit of the most recent purchases was $2.60, we get:

Cost of goods sold = 700 units x $2.60 per unit = $1,820.

Therefore, the correct answer is C) $1,720, which is the closest option to $1,820.

Inventory Records for Dunbar Incorporated Revealed the Following