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Question - Rodeo Company uses a periodic inventory system and had the following opening inventory and purchases during the month of June 2010:
Opening inventory 500 units @ $4.50/unit
June 6 800 units @ $4.40/unit
June 23 1,000 units @ $4.30/unit
Sales were made during the month as follows:
June 10 700 units @ $6.00 unit
June 26 900 units @ $6.00 unit
Calculate Rodeo's total cost of goods available for sale for the month of June 2010. Explain which accounting principle requires that a portion of the total cost of good available for sale for a period be allocated to cost of goods sold.
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