The following data is available for an item of LCC Inc.for the month of March:? $$\begin{array} { r l l }
\text { March } 1 & \text { Inventory } & 15 \text { units at } \$ 10 \text { each } \
15 & \text { Purchase } & 30 \text { units at } \$ 18 \text { each } \
31 & \text { Purchase } & 20 \text { units at } \$ 15 \text { each } \
& \text { Sale } & 30 \text { units }
\end{array}$$ ? Using the last-in, first-out method, what is ABC Inc.'s cost of ending inventory for March?
A) $450
B) $630
C) $540
D) $510

Question

The following data is available for an item of LCC Inc.for the month of March:? $$\begin{array} { r l l } 
\text { March } 1 & \text { Inventory } & 15 \text { units at } \$ 10 \text { each } \
15 & \text { Purchase } & 30 \text { units at } \$ 18 \text { each } \
31 & \text { Purchase } & 20 \text { units at } \$ 15 \text { each } \
& \text { Sale } & 30 \text { units }
\end{array}$$ ? Using the last-in, first-out method, what is ABC Inc.'s cost of ending inventory for March?
A) $450
B) $630
C) $540
D) $510

Quizplus · Accepted Answer

Under the LIFO method, the last items purchased are the first to be sold. The sale of 30 units will be from the March 31 purchase (20 units at $15) and 10 units from the March 15 purchase (10 units at $18). The ending inventory will be 20 units from March 15 purchase (20 units at $18) and 15 units from March 1 inventory (15 units at $10), totaling $510.

The Following Data Is Available for an Item of LCC