Evans Company Had the Following Balances and Transactions During 2016

question 27

Multiple Choice

Evans Company had the following balances and transactions during 2016.
$$\begin{array} { | l | l | } \hline \text { Beginning inventory } & 30 \text { units at } \$ 70 \\\hline 10 \text { March } & \text { Sold } 27 \text { units } \\\hline 10 \text { June } & \text { Purchased } 90 \text { units at } \$ 80 \\\hline 30 \text { October } & \text { Sold } 84 \text { units } \\\hline\end{array}$$
What is the amount of the company's inventory,as disclosed in the 31 December 2016 balance sheet as per the periodic last-in,first-out (LIFO) costing method?

• A) $720
• B) $480
• C) $630
• D) $420

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Definitions:

Fixed Costs

Expenses that do not change in the short term despite variations in production levels or sales volumes, such as rent, salaries, or insurance.

Total Revenue

The overall revenue that originates from a company's core operations, including the sale of its products or services.

Average Fixed Cost

The total fixed costs of production divided by the quantity of output produced, which decreases as production increases.

Average Total Cost

The total cost of production divided by the number of units produced, representing the average cost per unit of output.