The following units of an inventory item were available for sale during the year: $\begin{array}{ll}
\text { Beginning inventory } & 10 \text { units at } \$ 55 \
\text { First purchase } & 25 \text { units at } \$ 60 \
\text { Second purchase } & 30 \text { units at } \$ 65 \
\text { Third purchase } & 15 \text { units at } \$ 70
\end{array}$ The firm uses the periodic inventory system. During the year, 60 units of the item were sold.
The value of ending inventory using FIFO is:
A) $1,250
B) $1,350
C) $1,375
D) $1,150

Question

Quizplus · Accepted Answer

Under FIFO, the oldest costs are assigned to the cost of goods sold. The ending inventory consists of the most recent purchases: 15 units at $70 and 15 units at $65, totaling $1,375.

The Following Units of an Inventory Item Were Available for Sale