A company has inventory of 10 units at a cost of $10 each on June 1. On June 3, they purchased 20 units at $12 each. 12 units are sold on June 5. Using the FIFO periodic inventory method, what is the cost 18 units remaining in ending Inventory after the June 5 sale?
A)$196
B)$124
C)$104
D)$144
E)$216

Question

Quizplus · Accepted Answer

Under FIFO, the first units purchased are the first to be sold. The 12 units sold on June 5 would come from the 10 units at $10 each and 2 units from the 20 units at $12 each. The remaining 18 units in inventory would be 18 units from the 20 units purchased at $12 each, totaling $216.

A Company Has Inventory of 10 Units at a Cost