Chapter 7 HW: 2

LIFO Perpetual Inventory

The beginning inventory of merchandise at Dunne Co. and data on purchases and sales for a three-month period ending June 30 are as follows:

Date		Transaction	Number of Units		Per Unit		Total
Apr. 3		Inventory	84		$150		$12,600
8		Purchase	168		180		30,240
11		Sale	113		500		56,500
30		Sale	71		500		35,500
May 8		Purchase	140		200		28,000
10		Sale	84		500		42,000
19		Sale	42		500		21,000
28		Purchase	140		220		30,800
June 5		Sale	84		525		44,100
16		Sale	112		525		58,800
21		Purchase	252		240		60,480
28		Sale	126		525		66,150

Required:

1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustrated in Exhibit 4, using the last-in, first-out method. 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.

2. Determine the total sales, the total cost of merchandise sold, and the gross profit from sales for the period.

3. Determine the ending inventory cost on June 30.

Dunne Co. Schedule of Cost of Merchandise Sold LIFO Method For the three-months ended June 30 Cost of Merchandise Sold Quantity Unit Cost Total Cost Purchases Inventory Unit Cost Date Quantity Unit Cost Total Cost Quantity Total Cost Apr. 3 Apr & Apr 11 Apr. 30 May 8 1 - May 10 10 May 19 UL hinilliinili May 28 June 5 June 16 June 21 1 - I June 28 June 30 Balances Total sales $ Total cost of merchandise sold Gross profit $