21 023 00 0 0 00 0 0 00 0 00 0 0 0FIFO LIFO Beginning bal.

21
023
00
0
0
00
0
0
00
0
00
0
0
0FIFO
LIFO
Beginning bal.
17
021
023
00
0
0
00
0
0
00
0
00
0
0
0FIFO
LIFO
Beginning bal.
Purchase Jan. 2
Purchase July 1
Expense
Units
PriceConsumption in Units
Balance Left in Units
FIFO Inventory Value
Note:
LIFO Inventory Value
Under LIFO 500 doses purchased on July 1 are assumed to have been used even though only
400 doses were consumed after that date. This seems counter-intuitive. The key is that LIFO is a
cost flow assumption used only to calculate inventory-related expense and ending inventory balances.
It does not identify the specific inventory units that were actually consumed.
(LIFO/FIFO)
PROBLEM 10-17
Case Study

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