Question

Beginning inventory, purchases, and sales data for prepaid cell phones for May are as follows:

Inventory		Purchases		Sales
May 1	3,300 units at $32	May 10	1,650 units at $34	May 12	2,310 units
		May 20	1,485 units at $36	May 14	1,980 units
				May 31	990 units

Assume that the business maintains a perpetual inventory system, costing by the first-in, first-out method. Determine the cost of merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 3. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Merchandise Sold Unit Cost column and in the Inventory Unit Cost column.

Schedule of Cost of Merchandise Sold
FIFO Method
Prepaid Cell Phones
Date	Purchases Quantity	Purchases Unit Cost	Purchases Total Cost	Cost of Merchandise Sold Quantity	Cost of Merchandise Sold Unit Cost	Cost of Merchandise Sold Total Cost	Inventory Quantity	Inventory Unit Cost	Inventory Total Cost
May 1							fill in the blank 1	$fill in the blank 2	$fill in the blank 3
May 10	fill in the blank 4	$fill in the blank 5	$fill in the blank 6				fill in the blank 7	fill in the blank 8	fill in the blank 9
							fill in the blank 10	fill in the blank 11	fill in the blank 12
May 12				fill in the blank 13	$fill in the blank 14	$fill in the blank 15	fill in the blank 16	fill in the blank 17	fill in the blank 18
							fill in the blank 19	fill in the blank 20	fill in the blank 21
May 14				fill in the blank 22	fill in the blank 23	fill in the blank 24
				fill in the blank 25	fill in the blank 26	fill in the blank 27	fill in the blank 28	fill in the blank 29	fill in the blank 30
May 20	fill in the blank 31	fill in the blank 32	fill in the blank 33				fill in the blank 34	fill in the blank 35	fill in the blank 36
							fill in the blank 37	fill in the blank 38	fill in the blank 39
May 31				fill in the blank 40	fill in the blank 41	fill in the blank 42
				fill in the blank 43	fill in the blank 44	fill in the blank 45	fill in the blank 46	fill in the blank 47	fill in the blank 48
May 31	Balances					$fill in the blank 49

Answer 1

Determine the cost of merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 3. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Merchandise Sold Unit Cost column and in the Inventory Unit Cost column.

Schedule of Cost of Merchandise Sold
FIFO Method
Prepaid Cell Phones
Date	Purchases Quantity	Purchases Unit Cost	Purchases Total Cost	Cost of Merchandise Sold Quantity	Cost of Merchandise Sold Unit Cost	Cost of Merchandise Sold Total Cost	Inventory Quantity	Inventory Unit Cost	Inventory Total Cost
May 1							3300	32	105600
May 10	1650	34	56100				3300	32	105600
							1650	34	56100
May 12				2310	32	73920	990	32	31680
							1650	34	56100
May 14				990	32	31680
				990	34	33660	660	34	22440
May 20	1485	.36	53460				660	34	22440
							1485	36	53460
May 31				660	34	22440
				330	36	11880	1155	36	41580
May 31	Balances					173580			41580