Ending Inventory Calculation Using LIFO Method

What is the amount allocated to ending inventory on a LIFO basis?

Based on the provided inventory information, what would be the amount allocated to ending inventory on a LIFO basis?

Answer:

The amount allocated to ending inventory on a LIFO basis would be the cost of the earliest purchases, which is $9900.

In a periodic inventory system, the LIFO (Last In, First Out) method assumes that the most recent inventory purchases are the first ones sold. To determine the ending inventory on a LIFO basis, we need to allocate the cost of goods sold (COGS) based on the LIFO method. The LIFO method assumes that the last purchases are sold first, so the cost of the most recent purchases will be allocated to the COGS. This means that the cost of the remaining inventory will be the cost of the earlier purchases.

In this case, the amount allocated to ending inventory on a LIFO basis would be the cost of the earliest purchases, which is $9900. This amount represents the inventory that has not been sold at the end of the accounting period. So, the correct answer is $9900.

To calculate the ending inventory on a LIFO basis for Bramble Industries, inventory purchases and sales data during the period are required. Without detailed purchase and quantity information, it is not possible to determine the exact ending inventory using the numbers provided.

To determine the amount allocated to ending inventory on a LIFO basis (Last-In, First-Out) using a periodic inventory system, we would start with the most recently purchased inventory and work backward until we have accounted for the quantity of inventory remaining at the end of the period. Without detailed information on inventory purchases and sales during the period, it's not possible to calculate the ending inventory using the LIFO method with the numbers provided ($35,920, $10,100, $35,600, $9,900).

Each of these amounts could potentially represent the value of inventory purchased at different times, but to calculate LIFO, we need the costs associated with the most recent purchases and the quantities involved. It is important to note that LIFO assumes that the last items added to inventory are the first ones sold. So, we would subtract the cost of goods sold, calculated by starting with the most recent purchases, from total goods available, in order to find the ending inventory value. Since we're lacking specific purchase and quantity data, we cannot determine the ending inventory value using LIFO with the information given.