Garrett Corporation uses a periodic inventory system and the LIFO method to value its inventory. The company began 2018 with $63,600 in inventory of its only product. The beginning inventory consisted of the following layers:
4,800 units at $5 per unit
6,600 units at $6 per unit
Total: 24,000 + 39,600 = $63,600
During 2018, 6,800 units were purchased at $7 per unit and during 2019, 8,600 units were purchased at $8 per unit. Sales, in units, were 8,600 and 15,200 during 2018 and 2019, respectively.
Required:
1. Calculate cost of goods sold for 2018 and 2019.
2. Disregarding income tax, determine the LIFO liquidation profit or loss, if any, for 2018 and 2019.
Cost of Goods Sold - 2018:
2019:
LIFO liquidation Profit or loss - 2018:
2019:
