Inventory records for Dunbar Incorporated revealed the following: Date Transaction Number of Units Unit Cost Apr. 1 Beginning inventory 490 $ 2.16 Apr. 20 Purchase 420 2.63 Dunbar sold 570 units of inventory during the month. Ending inventory assuming LIFO would be: (Do not round your intermediate calculations. Round your answer to the nearest dollar amount.) Multiple Choice $1,105. $734. $894. $1,058.

Question

Jagger Cordova

Business

27 June, 03:36

Inventory records for Dunbar Incorporated revealed the following: Date Transaction Number of Units Unit Cost Apr. 1 Beginning inventory 490 $ 2.16 Apr. 20 Purchase 420 2.63 Dunbar sold 570 units of inventory during the month. Ending inventory assuming LIFO would be: (Do not round your intermediate calculations. Round your answer to the nearest dollar amount.) Multiple Choice $1,105. $734. $894. $1,058.

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Answers (1)

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Ferguson · Answer 1

The correct answer is B.

Explanation:

Giving the following information:

Apr. 1: Beginning inventory of 490 units for $2.16

Apr. 20: Purchase 420 units for $2.63

Dunbar sold 570 units of inventory during the month.

Under LIFO (last-in, first-out) method, the ending inventory is integrated by the first units incorporated into inventory.

First, we need to calculate the number of units in inventory:

Ending inventory in units = total units for sale - units sold

Ending inventory in units = (490 + 420) - 570 = 340 units

Ending inventory ($) = 340*2.16 = $734.4