Holliday Company's inventory records show the following data:
$\begin{array}{lrr}\text { Units }&\text { Unit Cost }\
\text { Inventory, January } 1 & 5,000 & £ 4.50 \
\text { Purchases: June 18 } & 4,500 & 4.00 \
\text { November } 8 & 3,000 & 3.50
\end{array}$

A physical inventory on December 31 shows 2,000 units on hand.Holliday sells the units for ?6 each.The company has an effective tax rate of 20%.Holliday uses the periodic inventory method. Under the FIFO method, the December 31 inventory is valued at

Question

Holliday Company's inventory records show the following data:
 $\begin{array}{lrr}\text { Units }&\text { Unit Cost }\
\text { Inventory, January } 1 & 5,000 & £ 4.50 \
\text { Purchases: June 18 } & 4,500 & 4.00 \
\text { November } 8 & 3,000 & 3.50
\end{array}$

A physical inventory on December 31 shows 2,000 units on hand.Holliday sells the units for ?6 each.The company has an effective tax rate of 20%.Holliday uses the periodic inventory method. Under the FIFO method, the December 31 inventory is valued at

Quizplus · Accepted Answer

Under FIFO, the ending inventory consists of the 2,000 units purchased on November 8 at a cost of £3.50 per unit, for a total value of £7,000.

Holliday Company's Inventory Records Show the Following Data A Physical Inventory on December 31 Shows 2,000 Units on Units