The following units of an inventory item were available for sale during the year: The firm uses the periodic inventory system. During the year, 60 units of the item were sold.
The value of ending inventory using FIFO is:
A) $1,250
B) $1,150
C) $1,275
D) $1,050

Question

The following units of an inventory item were available for sale during the year:  The firm uses the periodic inventory system. During the year, 60 units of the item were sold.
The value of ending inventory using FIFO is:
A) $1,250 
B) $1,150 
C) $1,275 
D) $1,050

Quizplus · Accepted Answer

Since the question uses the FIFO method, we need to assume that the first units purchased are the first units sold. Therefore, the cost of goods sold will be calculated using the cost of the 60 units purchased first. The remaining units will make up the ending inventory.

To calculate this, we need to know the cost per unit of the inventory item. Unfortunately, this information is not provided in the question. Therefore, we cannot calculate the ending inventory value.

The Following Units of an Inventory Item Were Available for Sale