Salmone Company reported the following purchases and sales of its only product.Salmone uses a perpetual inventory system.Determine the cost assigned to cost of goods sold using FIFO.

Question

Quizplus · Accepted Answer

Using FIFO, the cost of goods sold will be calculated by using the cost of the oldest inventory first. Therefore:
- The first 10 units sold will be from the beginning inventory at a cost of $200 ($20 per unit).
- The next 80 units sold will be from the purchases made on January 15 and January 22, at a cost of $2,980 (($60 per unit x 50 units) + ($55 per unit x 30 units)).
Total cost of goods sold = $200 + $2,980 = $3,180. Therefore, the answer is B).

Salmone Company Reported the Following Purchases and Sales of Its