LIFO/FIFO inventory methods?

Question

A company just starting business made the following four inventory purchases in June:

June 1 150 units $ 780

June 10 200 units 1,170

June 15 200 units 1,260

June 28 150 units 990

total=$4,200

A physical count of merchandise inventory on June 30 reveals that there are 200 units on hand.

8. Using the LIFO inventory method, the value of the ending inventory on June 30 is

a. $1,040.00

b. $1,072.50

c. $1,305.00

d. $1,320.00

9. Using the FIFO inventory method, the amount allocated to ending inventory for June is

a. $1,040.00

b. $1,072.50

c. $1,305.00

d. $1,320.00

Answer 1

Ending Inventory is what you have Left.

Last In First Out (LIFO) The first sets of units are what you have left.  1st 150@780=5.2 per unit, 10th 200@1170=5.85.

So using the first entries seeing you have only 200 left.

150 x 5.2 + 50 x 5.85 = 1072.50

First In First Out(FIFO) The last sets are what you have left. 28th 150@990 = 6.6 per unit, 15th 200@1260 is 6.3 per unit.

So using last to entries seeing that you only have 200 left.

150 x 6.6 + 50 x 6.3 = 1305.00