Beginning Inventory consists of 4 items at $10 each. During the month, the company purchased 3 items for $11 each and it sold 3 items. Using last-in, first-out, the 3 goods sold are ______.Multiple choice question.from the purchases made during the monthfrom the beginning inventorythe ones that were actually sold and cannot be determined from the information provided
Question
Beginning Inventory consists of 4 items at 11 each and it sold 3 items. Using last-in, first-out, the 3 goods sold are ______.Multiple choice question.from the purchases made during the monthfrom the beginning inventorythe ones that were actually sold and cannot be determined from the information provided
Solution
The correct answer is "from the purchases made during the month".
Here's why:
The Last-In, First-Out (LIFO) method assumes that the last items added to the inventory are the first ones to be sold. In this case, the last items added to the inventory were the 3 items purchased for $11 each during the month. Therefore, according to the LIFO method, these are the items that were sold.
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