The GMA corporation shows the following data related to an item of InventoryInventory, January 1 200 units @P50 Purchases, January 9 200 units @ P54 Purchases, January 19 100 units @ P60 Sales, January 20 380 units What value should be assigned to the Cost of Sale using FIFO?
Question
The GMA corporation shows the following data related to an item of InventoryInventory, January 1 200 units @P50 Purchases, January 9 200 units @ P54 Purchases, January 19 100 units @ P60 Sales, January 20 380 units What value should be assigned to the Cost of Sale using FIFO?
Solution
To calculate the Cost of Sale using the FIFO (First-In, First-Out) method, we need to sell the items in the order they were purchased. Here's how to do it:
-
Start with the first batch of inventory: 200 units @ P50 = P10,000.
-
Since we sold 380 units, we still need to account for another 180 units. The next batch of inventory was 200 units @ P54, but we only need 180 from this batch. So, 180 units @ P54 = P9,720.
-
Add these two amounts together to get the total Cost of Sale: P10,000 (from step 1) + P9,720 (from step 2) = P19,720.
So, the value that should be assigned to the Cost of Sale using FIFO is P19,720.
Similar Questions
The GMA corporation shows the following data related to an item of InventoryInventory, January 1 100 units @P50 Purchases, January 9 300 units @ P54 Purchases, January 19 90 units @ P60 Sales, January 20 340 units What will be the ending inventory in units using FIFO?
Periodic inventory using FIFO, LIFO, and weighted average cost methods The units of an item available for sale during the year were as follows: Date Line Item Description Units Cost per Unit Amount Jan. 1 Inventory 16 units at $34 $544 Aug. 13 Purchase 7 units at $36 252 Nov. 30 Purchase 7 units at $37 259 Available for sale 30 units $1,055 There are 18 units of the item in the physical inventory at December 31. The periodic inventory system is used. Determine the inventory cost using the (a) first-in, first-out (FIFO) method; (b) last-in, first-out (LIFO) method; and (c) weighted average cost method (round per-unit cost to two decimal places and your final answer to the nearest whole dollar).
Marsh Company had 150,000 units of product A on hand at January 1, costing P21 each. Purchases of product A during the month of January were: Units Unit cost January 10 200,000 2218 250,000 23 28 100,000 24 A physical count on January 31 shows 250,000 units of product A on hand. What is the cost of the inventory on January 31 under the FIFO method?
A company's inventory records report the following: Date Activities Units Acquired at Cost Units Sold at RetailAugust 1 Beginning inventory 15 units @ $38 = $570 August 5 Purchase 10 units @ $39 = $390 August 12 Purchase 20 units @ $40 = $800 August 15 Sales 30 units soldUsing the FIFO perpetual inventory method, what is the value of the inventory at August 15 after the sale?Multiple Choice$400$290$600$1,160$1,760
The GMA corporation shows the following data related to an item of InventoryInventory, January 1 100 units @P50 Purchases, January 9 300 units @ P54 Purchases, January 19 90 units @ P60 Sales, January 20 340 units Inventory, January 31 150 units What value should be assigned to the ending inventory using Weighted Average method?
Upgrade your grade with Knowee
Get personalized homework help. Review tough concepts in more detail, or go deeper into your topic by exploring other relevant questions.