A company had beginning inventory ... A company had beginning inventory of 10 units at a cost of $20 each on March 1. On March 2, it purchased 10 units at $22 each. On March 6 it purchased 6 units at $25 each. On March 8, it sold 22 units for $54 each. Using the FIFO perpetual inventory method, what was the cost of the 22 units sold

Question

Business

Dorian Morse

9 November, 23:59

A company had beginning inventory ... A company had beginning inventory of 10 units at a cost of $20 each on March 1. On March 2, it purchased 10 units at $22 each. On March 6 it purchased 6 units at $25 each. On March 8, it sold 22 units for $54 each. Using the FIFO perpetual inventory method, what was the cost of the 22 units sold

+4

Answers (1)

Know the Answer?

Bree · Answer 1

COGS = $470

Explanation:

Giving the following information:

Beginning inventory = 10 units for $20 each

On March 2, it purchased 10 units at $22 each.

On March 6 it purchased 6 units at $25 each.

On March 8, it sold 22 units for $54 each.

We need to determine the cost of goods sold for the 22 units under the FIFO (first-in, first-out) method. Using this method, we need to use the cost of the firsts units incorporated into inventory.

COGS = 10*20 + 10*22 + 2*25 = $470