Beginning inventory, purchases, and sales data for DVD players are as follows: November 1 Inventory 74 units at $52 10 Sale 58 units 15 Purchase 36 units at $55 20 Sale 20 units 24 Sale 18 units 30 Purchase 24 units at $57 The business maintains a perpetual inventory system, costing by the first-in, first-out method. a. Determine the cost of the goods sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 3. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column. Cost of the Goods Sold Schedule First-in, First-out Method DVD Players Date Quantity Purchased Purchases Unit Cost Purchases Total Cost Quantity Sold Cost of Goods Sold Unit Cost Cost of Goods Sold Total Cost Inventory Quantity Inventory Unit Cost Inventory Total Cost Nov. 1 $ $ Nov. 10 $ $ Nov. 15 $ $ Nov. 20 Nov. 24 Nov. 30 Nov. 30 Balances $ $ b. Based upon the preceding data, would you expect the inventory to be higher or lower using the last-in, first-out method? Check My Work

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Beginning inventory, purchases, and sales data for DVD players are as follows:

November 1	Inventory	74 units at $52
10	Sale	58 units
15	Purchase	36 units at $55
20	Sale	20 units
24	Sale	18 units
30	Purchase	24 units at $57

The business maintains a perpetual inventory system, costing by the first-in, first-out method.

a. Determine the cost of the goods sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 3. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column.

Cost of the Goods Sold Schedule
First-in, First-out Method
DVD Players
Date	Quantity Purchased	Purchases Unit Cost	Purchases Total Cost	Quantity Sold	Cost of Goods Sold Unit Cost	Cost of Goods Sold Total Cost	Inventory Quantity	Inventory Unit Cost	Inventory Total Cost
Nov. 1								$	$
Nov. 10					$	$
Nov. 15		$	$

Nov. 20

Nov. 24
Nov. 30

Nov. 30	Balances					$			$

b. Based upon the preceding data, would you expect the inventory to be higher or lower using the last-in, first-out method?

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