The following units of an item were avallable for sale during the year: The firm uses the perpetual inventory system, and there are 28 units of the item on hand at the end of the year a. What is the total cost of the ending inventory according to FIFO? b. What is the total cost of the ending inventory according to LIFO? x Feesback * Check Hy Wor a. Note that this exercise uses the perpetual inventory system. FiFo means that the first units purchased are assumad to be the firat to be sold. Therefore, ending inventory is made up of the most recent purchases. Think of your inventory in terms of "layers", The first sale comen from the oldest layer - beginning inventory. Is the remaining amount of the beginning inventory layer enough to satisfy the second sale? If not, the remaining amount of units soid should be taken trom. the first purchase layer. Any remainder from the first purchase will then be considered as the oldest goods to be irsed for the second aale. If the remainder from the firat purchase is not enough to satisfy the third sale, then cost of merehandise sold will come from the second purchase, The femaining units from the secend purchase make up the ending inventory. b. Note that this exercise uses the perpetual inventory systern. When the perpetual inventory svitem is used, revenue is recorted each time a sale is made along