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NEW QUESTION: 1
Beginning inventory of 50 units, purchased at $5
50 units purchased at $10
35 units purchased at $9
25 units sold at $15
70 units sold at $12
Tax rate = 40%
Beginning LIFO reserve = $300
Given the above, the LIFO reserve at the end of the period is ________.
A. $225
B. $135
C. $165
D. $185
Answer: C
Explanation:
Explanation/Reference:
Explanation:
COGS = Beginning inventory - Ending inventory + Purchases.
FIFO COGS = 50*5 + 45*10 = $700. LIFO COGS = 35*9 + 50*10 + 10*5 = $865. Beginning inventory
50*5 = $250. Purchases = 50*10 + 35*9 = $815.
Therefore, FIFO ending inventory = 250 + 815 - 700 = 365 and LIFO ending inventory = 250 + 815 - 865
200.
The LIFO Reserve is defined as the difference between the values of the inventory under FIFO and under LIFO. Therefore, LIFO reserve = 365 - 200 = 165.

One thought on “FPA_I Valid Exam Test - Pass FPA_I Test, Mock FPA_I Exam - Jamesnwabueze

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