The following information pertains to Julia & Company: March 1 Beginning inventory = 30 units @ $5
March 3 Purchased 15 units @ $4
March 9 Sold 25 units @ $8
What is the ending inventory balance for Julia & Company assuming that it uses FIFO?

Question

Quizplus · Accepted Answer

Under FIFO (First-In, First-Out), the oldest inventory costs are used up first. Julia & Company started with 30 units at $5 each. After selling 25 units, 5 units remain from the beginning inventory. Additionally, 15 units were purchased at $4 each. Therefore, the ending inventory is 5 units at $5 and 15 units at $4, totaling (5 x $5) + (15 x $4) = $25 + $60 = $85.

The Following Information Pertains to Julia & Company: March 1