Quan uses a periodic inventory system.At the end of April, Quan had 20 units on hand. April $\begin{array}{ll}
1&\text { On hand, } 10 \text { units } @ \$ 2 \text { each } & \$ 20 \
19&\text { Purchased } 90 \text { units } @ \$ 3 \text { each } & \$ 270 \
&\text { Goods available for sale } & \$ 290
\end{array}$ ? If Quan, Inc.uses FIFO inventory costing, how much is cost of goods sold for April?
A) $250
B) $232
C) $230
D) $240

Question

Quizplus · Accepted Answer

FIFO (first-in, first-out) assumes that the first units purchased are the first units sold. Therefore, the cost of goods sold for April is the cost of the 10 units on hand at the beginning of the month ($20) plus the cost of the 20 units purchased on April 19th ($60). This gives a total cost of goods sold of $80.

Quan Uses a Periodic Inventory System ? If Quan, Inc