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The Following Information Is Available for Yancey Company

question 159

Essay

The following information is available for Yancey Company:
Beginning inventory 600 units at $4
First purchase 900 units at $6
Second purchase 500 units at $7.20
Assume that Yancey uses a periodic inventory system and that there are 700 units left at the end of the month.
Instructions
Compute the cost of ending inventory under the
(a) FIFO method.
(b) LIFO method.


Definitions:

Inelastic Demand

A situation where the quantity demanded of a good or service changes very little when its price changes.

Luxury

Goods or services that are considered superior in quality and are often expensive, catering to a more affluent consumer base.

Necessity

A good or service that is considered essential for survival, such as food, shelter, and healthcare.

Income Elasticity

A measure of how much the demand for a good or service changes in response to a change in consumers' income.

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