Question

At the end of January, Mineral Labs had an inventory of 895 units, which cost $12 per unit to produce. During February the company produced 1,500 units at a cost of $16 per unit. a. If the firm sold 2,050 units in February, what was the cost of goods sold? (Assume LIFO inventory accounting.)

Answer 1

Answer:

$30,600

Explanation:

Under the LIFO Method, the cost of good sold equals to

= February units × cost per unit + Remaining units × cost per unit

= 1,500 units × $16 + 550 units × $12

= $24,000 + $6,600

= $30,600

Since the firm has sold 2,050 units, so out of which 1,500 units sold at a price of $16 and the remaining 550 units sold at a price of $12