Paxton Ltd had 200 units of one of its products, product Z, in stock on 1 May. These had cost £12 each. On 15 May 600 units were purchased from the supplier at a unit cost of £17, followed the next week by a further 100 units costing £18. The only sale made in the month occurred on 25 May, when 500 units were sold for £25 each. Assuming that the company uses the LIFO method of inventory pricing, what would be the gross profit reported for the month? A £4,000 B £5,000 C£3,900 £6,500
Paxton Ltd had 200 units of one of its products, product Z, in stock on 1 May. These had cost £12 each. On 15 May 600 units were purchased from the supplier at a unit cost of £17, followed the next week by a further 100 units costing £18. The only sale made in the month occurred on 25 May, when 500 units were sold for £25 each. Assuming that the company uses the LIFO method of inventory pricing, what would be the gross profit reported for the month? A £4,000 B £5,000 C£3,900 £6,500
Financial Accounting
15th Edition
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Carl Warren, James M. Reeve, Jonathan Duchac
Chapter7: Inventories
Section: Chapter Questions
Problem 4CP: Golden Eagle Company began operations on April 1 by selling a single product. Data on purchases and...
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