Option #2: LIFO Perpetual vs. LIFO Periodic

Below is a record of the purchases and sales of inventory throughout the first four months.

	Units	Cost/Price Per Unit
1/1/x7 Beginning Balance	100	$3.50
1/31/x7 Purchase	125	$4.00
2/15/x7 Purchase	250	$4.50
2/25/x7 Sale	150	$7.75
3/10/x7 Purchase	300	$5.00
3/31/x7 Purchase	75	$5.50
4/10/x7 Sale	225	$8.25
4/15/x7 Purchase	100	$6.00
4/30/x7 Sale	350	$8.50

Requirement

1. Calculate the cost of goods sold under the LIFO Perpetual Method for each of the below sales.

	Units	Cost Per Unit	Total
2/25/x7 Sale
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4/10/x7 Sale
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4/30/x7 Sale
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Total

2. Calculate the cost of goods sold under the LIFO Periodic Method for each of the below sales.

	Units	Cost Per Unit	Total
2/25/x7 Sale
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4/10/x7 Sale
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4/30/x7 Sale
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Total

3. What is the main reason for the differences in the two methods?