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18 January, 18:55

Inventory records for Dunbar Incorporated revealed the following: Date Transaction Number of Units Unit Cost Apr. 1 Beginning inventory 490 $ 2.16 Apr. 20 Purchase 420 2.63 Dunbar sold 570 units of inventory during the month. Ending inventory assuming LIFO would be: (Do not round your intermediate calculations. Round your answer to the nearest dollar amount.) Multiple Choice $1,105. $734. $894. $1,058.

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  1. 18 January, 20:07
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    The correct answer is B.

    Explanation:

    Giving the following information:

    Apr. 1: Beginning inventory of 490 units for $2.16

    Apr. 20: Purchase 420 units for $2.63

    Dunbar sold 570 units of inventory during the month.

    Under LIFO (last-in, first-out) method, the ending inventory is integrated by the first units incorporated into inventory.

    First, we need to calculate the number of units in inventory:

    Ending inventory in units = total units for sale - units sold

    Ending inventory in units = (490 + 420) - 570 = 340 units

    Ending inventory ($) = 340*2.16 = $734.4
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