Health Defense sells first aid kits 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: January 1: Beginning balance of 18 units at $13 each
January 12: Purchased 30 units at $14 each
January 19: Sold 24 units at a selling price of $30 each
January 20: Purchased 24 units at $17 each
January 27: Sold 27 units at a selling price of $30 each
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

Since the question states that Health Defense uses the periodic inventory system, the most appropriate method to use would be FIFO (first-in, first-out). This means that the first units purchased (at a lower cost) would be the first to be sold, and the ending inventory would consist of units purchased most recently (at a higher cost). Therefore, the cost of goods sold and ending inventory would reflect a more current market value.

Health Defense Sells First Aid Kits and Uses the Periodic