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Periodic method and LIFO method, and a purchase on last day of the year?


A company uses both the periodic method and LIFO. They make a purchase on the last day of the year with beginning inventory equaling ending inventory. Would the purchase be included on the balance sheet and/or income statement at year-end?

449 day(s) ago

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LoveDukeDog 		Of course. Include the purchase in year end periodic inventory, and value it under LIFO. So ending inventory is valued at beginning of year cost. In effect, the year end purchase goes to Cost of Goods Sold for the year. Don't confuse quantities on hand with their cost value under LIFO or FIFO. Treat them separately.

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