Lionworks Enterprises had the following inventory data:
Assuming FIFO, what is the ending inventory after the July 14 sale? (Round any intermediary calculations to the nearest cent and your final answer to the nearest dollar.)
A)$204
B)$65
C)$228
D)$206

Question

Lionworks Enterprises had the following inventory data: 
Assuming FIFO, what is the ending inventory after the July 14 sale? (Round any intermediary calculations to the nearest cent and your final answer to the nearest dollar.)
A)$204 
B)$65 
C)$228 
D)$206

Quizplus · Accepted Answer

To determine the ending inventory after the July 14 sale using FIFO, we need to work backwards through the purchases.

Starting with the most recent purchase on July 12 of 20 units at $12.30 each, we have a total cost of $246.00. We need to remove the 15 units sold on July 14 for a total cost of $184.50 (15 units * $12.30 each), leaving us with 5 units and a cost of $61.50.

Moving on to the purchase on July 2 of 10 units at $10.50 each, we add these units to our remaining inventory, giving us a total of 15 units with a cost of $166.50.

Lastly, we look at the purchase on June 15 of 20 units at $9.00 each. We can add all of these units to our remaining inventory, giving us a total of 35 units with a cost of $346.50.

Therefore, the ending inventory after the July 14 sale using FIFO is $228.

Lionworks Enterprises Had the Following Inventory Data