which inventory method most likely mimics the physical flow of health world rsquo s 559742

Accounting for inventory using the perpetual system—LIFO and journalizing inventory transactions

Health World began January with an inventory of 50 crates of vitamins that cost a total of $1,000. During the month, Health World purchased and sold merchandise on account as follows:

Health World uses the LIFO method. Cash payments on account totaled $5,500. Operating expenses for the month were $3,000, with two thirds paid in cash and the rest accrued as Accounts payable.

Requirements

1. Which inventory method most likely mimics the physical flow of Health World’s inventory?

2. Prepare a perpetual inventory record, using LIFO cost, for this merchandise.

3. Journalize all transactions using LIFO.