1. Prepare Mountain Cycle’s perpetual inventory record assuming the company uses the LIFO inventory costing method.
2. Journalize the August 16 purchase of merchandise inventory on account and the August 31 sale of merchandise inventory on account.
Mountain Cycles started August with 12 bicycles that cost $ 42 each. On August 16, Mountain bought 40 bicycles at $ 68 each. On August 31, Mountain sold 36 bicycles for $ 84.