A company sells a climbing kit and uses the periodic inventory system to account for its merchandise.The beginning balance of the inventory and its transactions during January were as follows:
$\begin{array}{|l|l|}
\hline \text { January 1: } & \text { Beginning balance of } 18 \text { units at } \$ 13 \text { each } \
\hline \text { January 12: } & \text { Purchased } 30 \text { units at } \$ 14 \text { each } \
\hline \text { January 19: } & \text { Sold } 24 \text { units at a selling price of } \$ 30 \text { each } \
\hline \text { January 20: } & \text { Purchased } 24 \text { units at } \$ 17 \text { each } \
\hline \text { January 27: } & \text { Sold } 27 \text { units at a selling price of } \$ 30 \text { each } \
\hline
\end{array}$
If the ending inventory is reported at $357,what inventory method was used?
A) LIFO
B) FIFO
C) Weighted average
D) Specific identification
E) Retail inventory method

Question

Quizplus · Accepted Answer

Under FIFO (First-In, First-Out), the oldest costs are assigned to the cost of goods sold, and the newest costs remain in ending inventory. The ending inventory consists of the most recent purchases: 3 units from January 12 at $14 each and 24 units from January 20 at $17 each, totaling $357.

A Company Sells a Climbing Kit and Uses the Periodic