Iliescu Sporting Goods had the following inventory records for one line of skis for the month of January:

- Refer to Exhibit 7-7. Assuming the perpetual FIFO inventory method is used, what is the cost of Iliescu's ending inventory?

Question

Iliescu Sporting Goods had the following inventory records for one line of skis for the month of January:

- Refer to Exhibit 7-7. Assuming the perpetual FIFO inventory method is used, what is the cost of Iliescu's ending inventory?

Quizplus · Accepted Answer

The perpetual FIFO method assumes that items sold are those that were acquired first. The cost of goods sold (COGS) is calculated by adding up the cost of each unit sold, starting with the oldest inventory. 
Using the perpetual FIFO method, the cost of Iliescu's ending inventory is calculated as follows: 
(5 units x $680) + (5 units x $690) + (1 unit x $770) = $3,446.

Iliescu Sporting Goods Had the Following Inventory Records for One