Cambrige AS and A Level Accounting Notes (9706)/ ZIMSECĀ  Advanced Accounting Level Notes: Inventory valuation: Inventory valuation methods: Last In First Out (LIFO): Example Question

If you are viewing this post on a small screen/mobile device please view it in Landscape Mode otherwise it will be distorted.

Mary Moyo

Mary Moyo operates a Sole Trader business trading as M M Toys where she buys and sells only one type of toy. On 1 January 20×7, MM Toys had opening inventory of 50 teddy bears at a purchase price of $30 each.

  • Her transactions for the first three months of 20×7 were:
DatePurchases(units)Purchase Price per unit ($)Sales (units)
Jan 830
Jan 1010030.00
Jan 1280
Jan 2112030.50
Jan 2890
Feb 150
Feb 1415031.00
Feb 23100
Mar 130
Mar 412031.50
Mar 19120
Mar 2310032.00
Mar 27120
  • No other transactions took place during the year
  • Each toy was sold for $50


  1. Calculate the value of the inventory at 31 March 20X7 using the LIFO method of valuation

To access more topics go the ZIMSEC Advanced Level Accounting page

To access more topics go to the Cambridge AS/A level page