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How do you account for the cost of the ones sold

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Question - You have just started a small retail business that only sells one product. In the first month, you made three different inventory purchases of 40 units each. The units in the first group cost $5.00 each. The units in the second group cost $5.25 each and the units in the third group cost $5.30. You purchased 120 units of inventory and sold 100 of them, leaving 20 in inventory. How do you account for the cost of the ones sold? Some combination of $5.00, $5.25, and $5.30? How does this decision affects the cost of merchandise sold and gross profit?

Reference no: EM133141748

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