Determine the cost of the merchandise sold

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Question - Perpetual inventory using FIFO

Beginning inventory, purchases, and sales data for portable DVD players are as follows:

June 1

Inventory

240 units at $78

June 10

Sale

180 units

June 15

Purchase

280 units at $80

June 20

Sale

220 units

June 24

Sale

90 units

June 30

Purchase

320 units at $86

The business maintains a perpetual inventory system, costing by the first-in, first-out method.

a. Determine the cost of the merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4.

b. Based upon the preceding data, would you expect the inventory to be higher or lower using the last-in, first-out method?

Reference no: EM131705329

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