Klump Co.
Klump Co. uses a perpetual inventory system and had the following inventory transactions for the month of June. $\begin{array}{lll}
\text { June }1 & \text { On hand, } 50 \text { units at } \$ 18.00 \text { each } &\$900\.00\
4 & \text { Purchased } 115 \text { units at } \$ 18.20 \text { each } &2,093.00\
5 & \text { Sold } 100 \text { units }\
10&\text { Purchased 75 units at $ \$18.25 $ each}&1,368.75\
24&\text { Sold 50 units}\
&\text { Total cost of goods available for sale}&\$4,361.75\
30 &\text { On hand, 100 units}
\end{array}$
-Refer to the information provided in the figure Klump Co.If the company uses the FIFO inventory costing method,what is the cost of goods sold for the month of June?

Question

Klump Co.
Klump Co. uses a perpetual inventory system and had the following inventory transactions for the month of June. $\begin{array}{lll}
\text { June }1 & \text { On hand, } 50 \text { units at } \$ 18.00 \text { each } &\$900\.00\
4 & \text { Purchased } 115 \text { units at } \$ 18.20 \text { each } &2,093.00\
5 & \text { Sold } 100 \text { units }\
10&\text {  Purchased 75 units at $ \$18.25 $ each}&1,368.75\
24&\text { Sold 50 units}\
&\text { Total cost of goods available for sale}&\$4,361.75\
30 &\text { On hand, 100 units}
\end{array}$ 
-Refer to the information provided in the figure Klump Co.If the company uses the FIFO inventory costing method,what is the cost of goods sold for the month of June?

Quizplus · Accepted Answer

Under FIFO, the oldest inventory costs are used first. The cost of goods sold for June is calculated as follows: 100 units sold on June 5 at $18.00 each (from June 1 inventory) = $1,800, and 50 units sold on June 24 at $18.20 each (from June 4 purchase) = $910. Total cost of goods sold = $1,800 + $910 = $2,710. However, the correct calculation should be $1,800 + $738 (50 units at $18.20) = $2,538.

Klump Co Klump Co -Refer to the Information Provided in the Figure Klump Co

Klump Co
Klump Co -Refer to the Information Provided in the Figure Klump Co