Perpetual Inventory Using LIFO Beginning inventory, purchases, and sales data for prepaid cell phones for May are as follows: Inventory Purchases Sales May 1 3,500 units at $32 May 10 1,750 units at $34 May 12 2,450 units May 20 1,575 units at $36 May 14 2,100 units May 31 1,050 units a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of merchandise 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 Merchandise Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column. Schedule of Cost of Merchandise Sold LIFO Method Prepaid Cell Phones
Perpetual Inventory Using LIFO Beginning inventory, purchases, and sales data for prepaid cell phones for May are as follows: Inventory Purchases Sales May 1 3,500 units at $32 May 10 1,750 units at $34 May 12 2,450 units May 20 1,575 units at $36 May 14 2,100 units May 31 1,050 units a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of merchandise 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 Merchandise Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column. Schedule of Cost of Merchandise Sold LIFO Method Prepaid Cell Phones
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Perpetual Inventory Using LIFO
Beginning inventory, purchases, and sales data for prepaid cell phones for May are as follows:
Inventory | Purchases | Sales | |||
May 1 | 3,500 units at $32 | May 10 | 1,750 units at $34 | May 12 | 2,450 units |
May 20 | 1,575 units at $36 | May 14 | 2,100 units | ||
May 31 | 1,050 units |
a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of merchandise 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 Merchandise Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column.
Schedule of Cost of Merchandise Sold |
LIFO Method |
Prepaid Cell Phones |
![Prepaid Cell Phones
Purchases
Cost of Merchandise
Sold Unit Cost
Quantity
Purchases
Quantity
Cost of Merchandise
Inventory
Quantity
Inventory
Date
Purchased
Unit Cost
Total Cost
Sold
Sold Total Cost
Total Cost
May
May
10
May
12
May
31
May
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?](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Faa208225-71d5-4cd2-87ee-3cbfb8a90204%2F5e90078b-46e7-43fb-ab24-6fc03c91f220%2F5cqr8_processed.png&w=3840&q=75)
Transcribed Image Text:Prepaid Cell Phones
Purchases
Cost of Merchandise
Sold Unit Cost
Quantity
Purchases
Quantity
Cost of Merchandise
Inventory
Quantity
Inventory
Date
Purchased
Unit Cost
Total Cost
Sold
Sold Total Cost
Total Cost
May
May
10
May
12
May
31
May
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?
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