A Company Had 22 Units of Inventory at a Cost

question 174

Multiple Choice

A company had 22 units of inventory at a cost of $26 each on November 1.On November 2,the company purchased 27 units at $27 each.On November 6,the company purchased 23 units at $28 each.On November 8,the company sold 52 units for $71 each.Given this information,determine the cost of the 52 units sold using the LIFO periodic inventory method.

• A)$1,997
• B)$1,456
• C)$1,436
• D)$1,425
• E)$1,385

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Definitions:

Investment

The operation of earmarking financial resources with the hope of obtaining a return or profit.

Simple Interest

A method of calculating interest where the interest charge is based on the original principal only, not on the accumulated interest.

Maturity Value

The amount payable to an investor at the end of a security's term or life, which typically includes the principal plus interest.

Principal

The original sum of money borrowed in a loan or the initial amount of money invested, excluding any interest or gains.