Boxwood Company sells blankets for $30 each. The following was taken from the inventory records during May. The company had no beginning inventory on May 1. Date Blankets Units Cost May 03 Purchase 6 $14 10 Sale 4 17 Purchase 12 $16 20 Sale 4 23 Sale 3 30 Purchase 12 $18 Assuming that the company uses the perpetual inventory system, determine the ending inventory for the month of May using the LIFO inventory cost method.

The ending inventory for the month of May using the LIFO inventory cost method is $324.

Explanation:

LIFO

LIFO method assumes that the last goods purchased are the first ones to be issued to the final customer.

This means valuation of inventory will use the value of the earliest goods purchased.

Ending Inventory : 2 units × $14   = $28

                               5 units × $16  = $80

                               12 units × $18 = $216

                               Total               = $324

Conclusion :

The ending inventory for the month of May using the LIFO inventory cost method is $324.