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Inventory Fows Under the LIFO Perpetual Inventory Method

Inventory records for Herb's Chemicals revealed the following:

March 1, 2009, inventory - 1,000 gallons @ $7.20 = $7,200

Purchases: Sales:
Mar. 10 - 600 gals @ 7.25 Mar. 5 - 400 gals
Mar. 16 - 800 gals @ 7.30 Mar. 14 - 700 gals
Mar. 23 - 600 gals @ 7.35 Mar. 20 - 500 gals
---------------------------------------Mar. 26 - 700 gals

13. (1) The ending inventory assuming LIFO and a perpetual inventory system is:
$1,545.
$1,470.
$1,580.
$1,510.

Solution Preview

Date March 1 March 10 March 16 March 23 Total
Beginning 1,000 1,000
March 5 ( 400) ( 400)
March 10 ...

Solution Summary

This solution demonstrates the assumed flows of inventory under the LIFO method if records are kept on a perpetual inventory basis.

$2.19