A company sells a climbing kit and uses the periodic inventory system to account for its merchandise. The beginning balance of the inventory and its transactions during January were as follows: If the ending inventory is reported at $357, what inventory method was used?
A) LIFO.
B) FIFO.
C) Weighted average.
D) Specific identification.
E) Retail inventory methoD.

Question

A company sells a climbing kit and uses the periodic inventory system to account for its merchandise. The beginning balance of the inventory and its transactions during January were as follows:  If the ending inventory is reported at $357, what inventory method was used?
A) LIFO. 
B) FIFO. 
C) Weighted average. 
D) Specific identification. 
E) Retail inventory methoD.

Quizplus · Accepted Answer

The ending inventory balance of $357 suggests that the company used the FIFO method because this method assumes that the first items purchased are the first ones sold, leaving the most recent purchases (and their cost) in ending inventory. Therefore, the cost of the ending inventory reflects the most recent purchases, resulting in a higher ending inventory balance than other methods.

A Company Sells a Climbing Kit and Uses the Periodic