Clear Clarinets has the following inventory data: $$\begin{array} { r l l }
\text { July } 1 & \text { Beginning inventory } & 50 \text { units at } \$ 120 \
5 & \text { Purchases } & 300 \text { units at } \$ 112 \
14 & \text { Sale } & 200 \text { units } \
21 & \text { Purchases } & 150 \text { units at } \$ 115 \
30 & \text { Sale } & 140 \text { units }
\end{array}$$ Assuming that a periodic inventory system is used, what is the amount allocated to ending inventory on a FIFO basis?
A)$18,220
B)$18,370
C)$38,480
D)$38,530

Question

Clear Clarinets has the following inventory data: $$\begin{array} { r l l } 
\text { July } 1 & \text { Beginning inventory } & 50 \text { units at } \$ 120 \
5 & \text { Purchases } & 300 \text { units at } \$ 112 \
14 & \text { Sale } & 200 \text { units } \
21 & \text { Purchases } & 150 \text { units at } \$ 115 \
30 & \text { Sale } & 140 \text { units }
\end{array}$$ Assuming that a periodic inventory system is used, what is the amount allocated to ending inventory on a FIFO basis?
A)$18,220
B)$18,370
C)$38,480
D)$38,530

Quizplus · Accepted Answer

Under FIFO, the ending inventory consists of the most recent purchases. After the sales, 160 units remain (50 from July 1 and 110 from July 21). The ending inventory is calculated as (10 units at $112) + (150 units at $115) = $18,370.

Clear Clarinets Has the Following Inventory Data Assuming That a Periodic Inventory System Is Used, What Is