Perpetual inventory using LIFO

Beginning inventory, purchases, and sales for Item $88-Hx$ are as follows:

July $1$ Inventory $96$ units @ $$34$

July $8$ Sale $,77$ units

July $15$ Purchase $107$ units @ $$38$

July $27$ Sale $90$ units

Assuming a perpetual inventory system and using the last$-$in$,$ first$-$out $($LIFO$)$ method, determine $($a$)$ the cost of goods sold on

July $27$ and $($b$)$ the inventory on July $31.$

a$.$ Cost of goods sold on July $27$

$$

b$.$ Inventory on July $31$

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a$.$ When the LIFO method is used, the cost of the units sold is the cost of the most recent purchases. Think of your

inventory in terms of "layers." Determine how much inventory remains from each layer after each sale.

b$.$ The ending inventory is made up of the oldest purchases.