In: Accounting
A company has beginning inventory of 17 units at a cost of $17 each on February 1. On February 3, it purchases 27 units at $19 each. 21 units are sold on February 5. Using the FIFO periodic inventory method, what is the cost of the 21 units that are sold?
Cost of Goods Sold for 21 Units sold on 15 Feb | ||||||
Date | Qty | Rate | Amount | |||
Beg. | 17 | 17 | 289 | |||
Feb.3 | 4 | 19 | 76 | |||
Total Cost of Goods sold | 21 | 365 | ||||
Cost of 21 units that are sold = $365 | ||||||
Note: We have taken 17 units at beg. Rate and 4 units at purchase rate of Feb.3 which means out of total 21 units which are sold. We took 17 units which were in our hand at the beginning of month and 4 units took from the purchase made on Feb.3 | ||||||
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