Question

Beginning inventory, purchases and sales data for tennis rackets are as follows:

	Apr 3	Inventory		12 units	@	$45
	11	Purchase		13 units	@	$47
	14	Sale		18 units
	21	Purchase		9 units	@	$60
	25	Sale		10 units

Assuming the business maintains a perpetual inventory system, calculate the cost of merchandise sold and ending inventory under First-in, first-out:

Group of answer choices

cost of merchandise sold $1,151; ending inventory $180

cost of merchandise sold $180; ending inventory $1,151

cost of merchandise sold $1,331; ending inventory $360

cost of merchandise sold $360; ending inventory $1,331

Answer 1

Correct answer-------------cost of merchandise sold $1,331; ending inventory $360

.

Working

	Units	Cost per unit	value
Beginning Balance	12	$                   45.00	$ 540
Purchases
	13	$                   47.00	$ 611
	9	$                   60.00	$ 540
Cost of goods available for sale	34		$ 1,691

.

FIFO
Total Units Available for sale		34
Units Sold		28
Closing Stock in Units		6
Valuation
Ending Inventory	6	@	$             60.00	$ 360
Cost of Goods sold	1691 minus 360			$        1,331.00