A firm that sells a single product had a beginning inventory of 4,000 units with a total cost of $28,000. Early in the year, 10,000 units were purchased at $9 each. Using FIFO, what is the value of the ending inventory of 3,000 units?

Question

Quizplus · Accepted Answer

Using FIFO (First-In, First-Out), the ending inventory of 3,000 units would be valued at the cost of the most recently purchased units. Since the last purchase was at $9 per unit, the ending inventory is valued at 3,000 units x $9 = $27,000.

A Firm That Sells a Single Product Had a Beginning