Perpetual Inventory Using LIFO Beginning inventory, purchases, and sales data for prepaid cell phones for December are as follows: Inventory Purchases Sales Dec. 1 3,700 units at $22 Dec. 10 1,850 units at $24 Dec. 12 2,590 units Dec. 20 1,665 units at $26 Dec. 14 2,220 units Dec. 31 1,110 units a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of goods sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4. Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the Cost of Goods Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column.
Perpetual Inventory Using LIFO Beginning inventory, purchases, and sales data for prepaid cell phones for December are as follows: Inventory Purchases Sales Dec. 1 3,700 units at $22 Dec. 10 1,850 units at $24 Dec. 12 2,590 units Dec. 20 1,665 units at $26 Dec. 14 2,220 units Dec. 31 1,110 units a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of goods sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4. Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the Cost of Goods Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:Quantity Purchases Purchases Quantity
Sold
Sold
Inventory Inventory
Total
Purchased Unit Cost
Total Cost
Sold
Unit
Total
Quantity Unit Cost
Date
Cost
Cost
Cost
Dec.
3,700
22
81,400
Dec.
1,850
24
44,400
3,700
22
81,400
10
1,850
24
44,400
Dec.
1,850
24
44,400
12
Dec.
14
Dec.
20
Dec.
31
Dec.
Balances
31
b. Based upon the preceding data, would you expect the inventory to be higher or lower using the first-in, first-out
method?
00000
00000
I| ||

Transcribed Image Text:Perpetual Inventory Using LIFO
Beginning inventory, purchases, and sales data for prepaid cell phones for December are as follows:
Inventory
Purchases
Sales
Dec. 1
3,700 units at $22
Dec. 10
1,850 units at $24
Dec. 12
2,590 units
Dec. 20
1,665 units at $26
Dec. 14
2,220 units
Dec. 31
1,110 units
a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of goods
sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4.
Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the
Cost of Goods Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column.
Schedule of Cost of Goods Sold
LIFO Method
Prepaid Cell Phones
Cost of
Cost of
Goods
Goods
Inventory
Quantity Purchases Purchases Quantity
Sold
Sold
Inventory Inventory
Total
Purchased Unit Cost Total Cost
Sold
Unit
Total
Quantity Unit Cost
Date
Cost
Cost
Cost
Dec.
3,700
22
81,400
1
Dec
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