Assume that the business in Exercise 6-3 maintains a perpetual inventory system, costing by the last-in, first-out
Question:
Assume that the business in Exercise 6-3 maintains a perpetual inventory system, costing by the last-in, first-out 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.
Data From Exercise 6-3:
Beginning inventory, purchases, and sales data for portable DVD players are as follows:
The business maintains a perpetual inventory system, costing by the first-in, first-out method.
a. Determine the cost of the merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 3.
b. Based upon the preceding data, would you expect the inventory to be higher or lower using the last-in, first-out method?
Exhibit 4:
ENTRIES AND PERPETUAL INVENTORY ACCOUNT (LIFO)
Step by Step Answer:
Corporate Financial Accounting
ISBN: 978-1133952411
12th edition
Authors: Carl S. Warren, James M. Reeve, Jonathan E. Duchac