Question

The Ivanhoe Shop shows the following data related to an item of inventory: Inventory, January 1 310 units @ $6.00 Purchase, January 9 870 units @ $6.50 Purchase, January 19 210 units @ $7.00 Inventory, January 31 310 units

(a) What value should be assigned to the ending inventory using FIFO? Value assigned to the ending inventory $

Answer 1

• Ending Inventory = $ 2,120

FIFO	Cost of Goods available for sale			Cost of Goods Sold			Ending Inventory
	Units	Cost/unit	COG for sale	Units sold	Cost/unit	COGS	Units	Cost/unit	Ending inventory
Beginning Inventory	310	$                   6.00	$                        1,860.00	310	$                 6.00	$                 1,860.00	0	$                   6.00	$                         -
Purchases:
09-Jan	870	$                   6.50	$                        5,655.00	770	$                 6.50	$                 5,005.00	100	$                   6.50	$                650.00
19-Jan	210	$                   7.00	$                        1,470.00	0	$                 7.00	$                              -	210	$                   7.00	$            1,470.00
TOTAL	1390		$                        8,985.00	1080		$                 6,865.00	310		$            2,120.00