A company has beginning inventory of 18 units at a cost of $18 each on February

Question

A company has beginning inventory of 18 units at a cost of $18 each on February 1. On February 3, it purchases 28 units at $20 each. 23 units are sold on February 5. Using the FIFO periodic inventory method, what is the cost of the 23 units that are sold?

$442

$432

$414

$428

$424

A company has beginning inventory of 18 units at a cost of $18 each on February 1. On February 3, it purchases 28 units at $20 each. 23 units are sold on February 5. Using the FIFO periodic inventory method, what is the cost of the 23 units that are sold?

Explanation / Answer

Date Units Rate Amount Beginning Balance 18 $18 $324 Feb. 3 5 $20 $100     Total 23 $424 Hence the correct option is $424

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