Blink Company, which uses the FIFO inventory method, had 508,000 units in inventory at the beginning of the year at a FIFO cost per unit of $20.No purchases were made during the year.Quarterly sales information and end-of-quarter replacement cost figures follow:
The market decline in the first quarter was expected to be nontemporary.Declines in other quarters were expected to be permanent.
Required:
Determine cost of goods sold for the four quarters and verify the amounts by computing cost of goods sold using the lower-of-cost-or-market method applied on an annual basis.

Question

Blink Company, which uses the FIFO inventory method, had 508,000 units in inventory at the beginning of the year at a FIFO cost per unit of $20.No purchases were made during the year.Quarterly sales information and end-of-quarter replacement cost figures follow:  
The market decline in the first quarter was expected to be nontemporary.Declines in other quarters were expected to be permanent.
Required:
Determine cost of goods sold for the four quarters and verify the amounts by computing cost of goods sold using the lower-of-cost-or-market method applied on an annual basis.

Quizplus · Accepted Answer

The Answer of Blink Company, which uses the FIFO inventory method, had 508,000 units in inventory at the beginning of the year at a FIFO cost per unit of $20.No purchases were made during the year.Quarterly sales information and end-of-quarter replacement cost figures follow:  
The market decline in the first quarter was expected to be nontemporary.Declines in other quarters were expected to be permanent.
Required:
Determine cost of goods sold for the four quarters and verify the amounts by computing cost of goods sold using the lower-of-cost-or-market method applied on an annual basis.

Blink Company, Which Uses the FIFO Inventory Method, Had 508,000