Perpetual Inventory Using LIFO Beginning inventory, purchases, and sales data for prepaid cell phones for May are as follows: Inventory May 1 Purchases Sales 3,400 units at $24 May 10 20 1,700 units at $26 1,530 units at $28 May 12 2,380 units 14 2,040 units 31 1,020 units a. Assuming that the perpetual inventory system is used, costing by the LIFO method, determine the cost of merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4. Under LIFO, if units are in inventory at two different costs, enter the units with the HIGHER unit cost first in the Cost of Merchandise Sold Unit Cost column and LOWER unit cost first in the Inventory Unit Cost column. Schedule of Cost of Merchandise Sold LIFO Method Prepaid Cell Phones Cost of Cost of Merchandise Merchandise Sold Total Cost Date Quantity Purchased Unit Cost Total Cost Purchases Purchases Quantity Sold Sold Unit Cost May 1 May 10 May 12 Inventory Inventory Inventory Quantity Unit Cost Total Cost Prepaid Cell Phones Cost of Cost of Merchandise Merchandise Sold Total Cost Inventory Inventory Inventory Quantity Unit Cost Total Cost Quantity Date Purchased Purchases Purchases Quantity Unit Cost Total Cost Sold Sold Unit Cost May 1 May 10 May 12 May 14 May 20 May 31 May 31 Balances $ 000 00000 b. Based upon the preceding data, would you expect the inventory to be higher or lower using the first-in, first-out method? b. Based upon the preceding data, would you expect the inventory to be higher or lower using the first-in, first-out method? Previous Next