The inventory data for an item for November are: Using a perpetual system,what is the cost of the goods sold for November if the company uses LIFO?

A) $610
B) $600
C) $590
D) $580

Question

The inventory data for an item for November are: Using a perpetual system,what is the cost of the goods sold for November if the company uses LIFO?

A) $610 
B) $600 
C) $590 
D) $580

Quizplus · Accepted Answer

Since the company uses LIFO (last in, first out) under perpetual inventory system, we assume that the cost of goods sold for November will be based on the most recent purchases, which are the purchases made on November 28th. Therefore, the cost of goods sold will be calculated as follows:

Cost of goods sold = Quantity sold x Cost per unit
= 50 x $11.80 (cost of the November 28th purchase)
= $590

Therefore, the correct answer is option C.

The Inventory Data for an Item for November Are: Using