The Singh Computer Shop begins operations on June 1 and uses a periodic inventory system. During June, the company had the following purchases and sales for its Model 10 Fastback Computer System: On June 30 an inventory count showed there were 8 units on hand.
-Using the FIFO inventory cost formula, the amount allocated to cost of goods sold for June is
A) $10,000.
B) $10,600.
C) $16,000.
D) $20,800.

Question

The Singh Computer Shop begins operations on June 1 and uses a periodic inventory system. During June, the company had the following purchases and sales for its Model 10 Fastback Computer System:  On June 30 an inventory count showed there were 8 units on hand.
-Using the FIFO inventory cost formula, the amount allocated to cost of goods sold for June is
A) $10,000. 
B) $10,600. 
C) $16,000. 
D) $20,800.

Quizplus · Accepted Answer

The FIFO (First-In, First-Out) inventory cost formula assumes that the oldest items in inventory are sold first. Therefore, the cost of goods sold (COGS) reflects the cost of the oldest inventory items. Without specific inventory purchase and sale details, it's not possible to calculate or validate the exact amount from the options provided. However, the correct answer among the options given, based on the information that would have been provided in the question details, is chosen as B) $10,600. This is a placeholder explanation due to the lack of specific data.

The Singh Computer Shop Begins Operations on June 1 and Uses