Chase Co.uses the perpetual inventory method.The inventory records for Chase reflected the following information:

-Assuming Chase uses a FIFO cost flow method,what is the cost of goods sold for the sales transaction on January 31?
A)$1,020
B)$1,005
C)$1,045
D)$340

Question

Chase Co.uses the perpetual inventory method.The inventory records for Chase reflected the following information:
 
-Assuming Chase uses a FIFO cost flow method,what is the cost of goods sold for the sales transaction on January 31?
A)$1,020 
B)$1,005 
C)$1,045 
D)$340

Quizplus · Accepted Answer

The first-in,first-out (FIFO)cost flow method requires that the cost of the items purchased first be assigned to cost of goods sold.
Cost of goods sold = (200 × $2.10)+ (250 × $2.40)= $1,020

Chase CoUses the Perpetual Inventory Method