Asked by Charlease Jordan on Jul 28, 2024

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One unit is sold on October 31 for $28. Using the table provided, what is the cost of goods sold under the LIFO method?

A) $28
B) $18
C) $15
D) $13

LIFO Method

Last In, First Out; an accounting method for valuing inventory by treating the most recently produced items as the first to be sold.

Cost Of Goods Sold

Direct costs attributable to the production of goods sold by a company, including materials, labor, and overhead.

Merchandise

Goods that are purchased, stored, and sold by a business in the ordinary course of its operations, often referred to as inventory.

  • Master the computation and understanding of assorted inventory accounting approaches, notably FIFO, LIFO, and Average cost.
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Verified Answer

AN
Alejandro NodarseJul 29, 2024
Final Answer :
C
Explanation :
Under LIFO method, the cost of the last unit purchased is matched with the revenue earned from the sale. Therefore, the cost of goods sold would be $15 (cost of the third unit purchased).