Posted by **Anonymous** on Sunday, October 18, 2009 at 10:20am.

3) A firm has beginning inventory of 300 units at a cost of $11 each. Production during the period was 650 units at $12 each. If sales were 700 units, what is the value of the ending inventory using LIFO?

A. $3,300

B. $2,750

C. $3,250

D. $2,550

- finance -
**jim**, Sunday, October 18, 2009 at 11:44am
LIFO = Last In First Out.

Whatever you just bought, or made, is what you sell next.

If I start with 5 units @$10,

then buy 7 @$20,

then sell 10,

which 10 do I sell?

I sell the _last_ 10 that I got, which will be the 7@$20 and 3 of the 5 @$10.

That will leave me with the first two I bought, which I valued @ $10 each.

Now look at your question again. Which 700 were sold? Which 250 were left?

- finance -
**blaine**, Thursday, April 1, 2010 at 1:54am
It is B. $2,750

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