A company purchased 500 units for $30 each on January 31. It purchased 550 units for $33 each on February 28. It sold a total of 650 units for $45 each from March 1 through December 31. What is the cost of ending inventory on December 31 if the company uses the first-in, first-out (FIFO) inventory costing method? (Assume that the company uses a perpetual inventory system.)

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Under the FIFO method, the first items purchased are the first ones to be sold. The company purchased 500 units at $30 each and then 550 units at $33 each. It sold 650 units, so all 500 of the first batch and 150 of the second batch were sold. The ending inventory consists of the remaining 400 units from the second purchase at $33 each, totaling $13,200 (400 units * $33/unit).

A Company Purchased 500 Units for $30 Each on January