Question
Asked Oct 19, 2019
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Salmone Company reported the following purchases and sales of its only product. Salmone uses a perpetual inventory system. Determine the cost assigned to ending inventory using
LIFO.
Units Sold at Retail
Activities
Units Acquired at Cost
150 units @ $10.00
220 units @ $12.00
Date
Beginning Inventory
May 1
Purchase
5
140 units @$20.00
Sales
10
100 units @ $13.00
Purchase
15
Sales
90 units@ $21.00
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Salmone Company reported the following purchases and sales of its only product. Salmone uses a perpetual inventory system. Determine the cost assigned to ending inventory using LIFO. Units Sold at Retail Activities Units Acquired at Cost 150 units @ $10.00 220 units @ $12.00 Date Beginning Inventory May 1 Purchase 5 140 units @$20.00 Sales 10 100 units @ $13.00 Purchase 15 Sales 90 units@ $21.00

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Expert Answer

Step 1

Compute cost assigned to ending inventory under LIFO method as shown below:

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К м N P R. LIFO 17 Ending inventory Unit rate Total cost 150 18 Purchases Goods sold Unit rate Total cost Unit rate Total cost 19 Date Units Units Units 01-May 05-May $1,500 $1,500 $2,640 $1,500 $10 20 $2,640 21 220 $12 150 S10 22 220 S12 $1,680 150 10-May S12 23 140 $10 $12 $960 24 80 15-May S1,500 $960 $1,300 $1,500 25 100 S13 $1,300 150 $10 26 S0 100 150 $12 $13 27 $1,170 24-May $13 $10 28 90 80 $12 $960 29 $130 $2,590 10 $13 30 $2,850 31 Total

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Step 2

Calculation fo...

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K L M 17 LIFO 18 Purchases Goods sold Ending inventory Unit rate 10 19 Date Units Unit rate Total cost Units Unit rate Total cost Total cost Units =R20 S20 -R21*S21 -R22*S22 -R23 * S23 =R24* S24 - R25 * S25 -R26 S26 150 =R20 -L21 -R21 =R22-023| - S22 -R23 =R24 =L25 20 43586 -L21 M21 21 43590 220 -S20 -M21 - S21 12 22 -O23 P23 140 -S22 23 43595 24 L25*M25 25 43600 100 13 - S23 -S24 M25 -S25 26 27 R27 S27 028 P28 28 43609 90 -S27 -R25 =R26 -R27- 028 |- S27 -R28 S28 -R29* S29 =R30 S30 -SUM(T28:T30)| 29 - S26 30 |=SUM(Q21:Q30) 31 Total

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