Mesa Company's Inventory and Purchases Accounts Show the Following Data

question 139

Essay

Mesa Company's inventory and purchases accounts show the following data for the month of September: $\begin{array}{llr}&\text { Units }&\text { Unit Cost }\\\text { Inventory, September 1 } & 100 & \$ 3.35 \\\text { Purchases: September 8 } & 450 & 3.50 \\\text { September 18 } & 350 & 3.70\end{array}$ A physical inventory on September 30 shows 250 units on hand. Calculate the cost of ending inventory and cost of goods sold if the company uses the LIFO method and a periodic inventory system.

---

Definitions:

Nondeductible Items

Expenses or items that cannot be subtracted from gross income to reduce taxable income according to tax laws.

Partnership Interest

An ownership share in a partnership that entitles the holder to a portion of the entity's profits and losses.

FMV

Fair Market Value, the price at which property would sell on the open market between a willing buyer and a willing seller.

Partnership Basis

The amount invested in a partnership by the partners, adjusted for additions, withdrawals, and the individual's share of partnership profits or losses.