Use the Information Below to Answer the Following Questions:
Diligent

question 1

Multiple Choice

Use the information below to answer the following questions:
Diligent Ltd had 5 units of the commodity Algo on hand at 1 September 2012. The following purchases and sales were made during September:

$\begin{array}{llcc} \text { Opening Balance } & \text { Purchases } & \text { Sales } \\ \text {September1\quad 5 units@\$200 \( \$ \) } & \text {September3\quad 5 units @ \$240 \( \quad \) }& \text {September \( 7 \quad 7 \) units}\\ \text { } & \text { 12\quad 3 units@\$260} & \text { 27\quad 5 units } \\ \text { } & \text {25\quad 6 units@\$200 } & \text { } \\\end{array}$
-What was the value of ending inventory of Algo,using the LIFO assumption in a perpetual inventory system?

• A) $1460
• B) $1480
• C) $1580
• D) $2400.

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Definitions:

Variable Cost Per Unit

The cost that varies with each unit of product produced, directly tied to the production volume, such as materials and labor.

Fixed Costs

Expenses that remain constant regardless of the level of production or sales, including items like rent, salaries, and insurance.

Contribution Margin Ratio

The percentage of sales revenue that exceeds variable costs, indicating how much sales contribute to fixed costs and profit.

Budgeted Sales

Projected sales figures that are estimated by a business for a future accounting period, used for planning and strategic purposes.