Perpetual Inventory UsingLIFO

Beginning inventory, purchases, and sales data for prepaid cell phones for May are as follows:

InventoryPurchasesSalesMay 13,600 units at $37May 101,800 units at $39May 122,520 unitsMay 201,620 units at $41May 142,160 unitsMay 311,080 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 inExhibit 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 SoldLIFO MethodPrepaid Cell PhonesDateQuantity PurchasedPurchases Unit CostPurchases Total CostQuantity SoldCost of Merchandise Sold Unit CostCost of Merchandise Sold Total CostInventory QuantityInventory Unit CostInventory Total CostMay 1fill in the blank 175dd509403804f_1

$

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$

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May 10fill in the blank 175dd509403804f_4

$

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$

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May 12fill in the blank 175dd509403804f_13

$

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$

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May 14fill in the blank 175dd509403804f_22

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May 20fill in the blank 175dd509403804f_28

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May 31fill in the blank 175dd509403804f_37

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May 31Balances$

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$

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b.Based upon the preceding data, would you expect the inventory to be higher or lower using thefirst-in, first-out method?