Question

3. Easton Company uses the periodic inventory system and had the following inventory & sales activity for the month of May 2019: Date Activity Quantity Unit Price 5/1 Beginning Inventory 100 $10 5/5 Purchase 240 $12 5/15 Purchase 270 $14 5/25 Purchase 320 $16 Sales were 430 units at $20. Using the FIFO method, determine the dollar value of Cost of Goods Sold for the month of May.

Answer 1

Date	Units	Unit Cost	Total Cost
5/1	100	10	1,000
5/5	240	12	2,880
5/15	270	14	3,780
5/25	320	16	5,120
	930		12,780

Number of units sold = 430

Number of units available for sale = 930

Ending inventory =  Number of units available for sale- Number of units sold

= 930-430

= 500 units

Calculation of cost of ending inventory

Date	Units	Unit Cost	Total Cost
5/15	180	14	2,520
5/25	320	16	5,120
	500		7,640

Cost of goods sold = Cost of goods available for sale - Cost of ending inventory

= 12,780-7,640

= $5,140

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