Weiss Company purchased two identical inventory items. The first purchase cost $20 and the second cost $24. The Company sold one of the items for $39. If the Company uses the LIFO cost flow method, the balance in the inventory account afte the sale transaction will be: Multiple

Weiss Company purchased two identical inventory items. The first purchase cost $20 and the second cost $24. The Company sold one of the items for $39. If the Company uses the LIFO cost flow method, the balance in the inventory account afte the sale transaction will be: Multiple

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Inventory Accounting

Inventory accounting is that branch of accounting that helps in determining the specific value of assets at different stages of production and development.

Question

Weiss Company purchased two
identical inventory items. The first
purchase cost $20 and the second
cost $24. The Company sold one of
the items for $39. If the Company
uses the LIFO cost flow method, the
balance in the inventory account after
the sale transaction will be: Multiple
Choice $24. $22. $20. $15.

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Step 1: Inventory valuation method -LIFO (Last -In-First -Out)

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Step 2: Calculation of balance in inventory after the sale transaction (LIFO method )

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