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Castle TV,Inc.purchased 1,000 monitors on January 5 at a per-unit cost of $185,and another 1,000 units on January 31 at a per-unit cost of $230.In the period from February 1 through year-end,the company sold 1,800 units of this product.At year-end,200 units remained in inventory.
-Assume that Castle TV,Inc.uses the LIFO flow assumption.The cost of the 200 units in the year-end inventory is:
A)$37,000.
B)$46,000.
C)$41,500.
D)$83,000.

Question

Quizplus · Accepted Answer

Under the LIFO (Last-In, First-Out) method, the most recently purchased items are sold first. Therefore, the 200 units remaining in inventory would be from the initial purchase of 1,000 units at $185 each. The cost of the 200 units in inventory is 200 units * $185/unit = $37,000.

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