A Company Had Inventory of 14 Units at a Cost

question 79

Essay

A company had inventory of 14 units at a cost of $18 each on November 1. On November 2, they purchased 19 units at $19 each. On November 6, they purchased 15 units at $20 each. On November 8, they sold 36 units for $63 each. Using the LIFO periodic inventory method, what was the cost of the 36 units sold?

---

Definitions:

Inventory Turnover

The relationship between the volume of goods sold and inventory, computed by dividing the cost of goods sold by the average inventory.

Purchase Order

An official document issued by a buyer committing to pay the seller for the supply of specific products or services at agreed prices.

Approved Vendor

A supplier that has been vetted and authorized by a company to provide goods or services.

Receiving Report

A document that records the details of goods received by a company, ensuring the quantities and quality match the purchase order.