ourses/28638/quizzes/260611/take The Boxwood Company sells blankets for $60 each

Question

ourses/28638/quizzes/260611/take The Boxwood Company sells blankets for $60 each. The following was taken from the inventory records during May. The company had no beginning inventory on May 1. Date May 3 Purchase May 10 Sale May 17Purchase May 20 Sale May 23 Sale Product Z Units Cost $20 3 10 6 3 $24 May 30 Purchase 10 $30 Assuming that the company uses the perpetual inventory system, determine the cost of merchandise sold for the sale of May 20 using the FIFO inventory cost method. $144 $120 $136 C. $180

Explanation / Answer

CALCULATION OF COST OF ENDING INVENTORY AND COST OF GOODS SOLD UNDER FIFO METHOD Purchases Sales Balance Date Particulars Units (A) Rate Per unit Total Cost Units (A) Rate Per unit Total Cost Units (A) Rate Per unit Total Cost May, 03 Purchases 5 $4 $20 May, 10 Sold 3 2 $20 $40 May, 17 Purchases 10 $24 $240 2 $20 $40 10 $24 $240 May, 20 2 $20 $40 4 $24 $96 Total 6 $136 Annswer = Option 3 = $ 136

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