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26 September, 05:00

Beginning inventory10 units @ $10 per unit First purchase35 units @ $11 per unit First sale20 units Second purchase40 units @ $12 per unit Second sale35 units Third purchase15 units @ $13 per unit What is the value of the ending inventory using a perpetual inventory system with the LIFO costing method? a) $485 b) $555 c) $520 d) $540

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  1. 26 September, 07:16
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    option C

    Step-by-step explanation:

    given,

    Beginning inventory 10 units @ $10 per unit

    First purchase 35 units @ $11 per unit

    Second purchase 40 units @ $12 per unit

    Third purchase 15 units @ $13 per unit

    first sale = 20 units

    second sale = 35 units

    now,

    unit left after first sale = 35 - 20 = 15 units @ $11 per unit

    unit left after second sale = 40 - 35 = 5 @ $12 per unit

    third purchase = 15 units @ $13 per unit

    inventory = 10 units @ $10 per unit + 15 units @ $11 per unit + 5 @ $12 per unit + 15 units @ $13 per unit

    = 100 + 165 + 60 + 195

    = $ 520

    hence, the correct answer is option C
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