Perpetual inventory using FIFO Beginning inventory, purchases, and sales data for prepaid cell phones for December are as follows: Inventory Date Units and Cost Dec. 1 120 units at $20 Purchases Date Units and Cost Dec. 10 60 units at $22 20 54 units at $24 Sales Date Units Dec. 12 84 units 14 72 units 31 36 units Assume that the business maintains a perpetual inventory system, costing by the first-in, first-out method. Determine the cost of 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. FIFO MethodPrepaid Cell Phones Date PurchasesQuantity PurchasesUnit Cost PurchasesTotal Cost Cost ofGoods SoldQuantity Cost ofGoods SoldUnit Cost Cost ofGoods SoldTotal Cost InventoryQuantity InventoryUnit Cost InventoryTotal Cost Dec. 1 Dec. 1 Dec. 1 Dec. 1 Dec. 10 Dec. 10 Dec. 10 Dec. 10 Dec. 10 Dec. 10 Dec. 10 fill in the blank 10 fill in the blank 11 fill in the blank 12 Dec. 12 Dec. 12 Dec. 12 Dec. 12 Dec. 12 Dec. 12 Dec. 12 fill in the blank 19 fill in the blank 20 fill in the blank 21 Dec. 14 Dec. 14 Dec. 14 Dec. 14 fill in the blank 25 fill in the blank 26 fill in the blank 27 fill in the blank 28 fill in the blank 29 fill in the blank 30 Dec. 20 Dec. 20 Dec. 20 Dec. 20 Dec. 20 Dec. 20 Dec. 20 fill in the blank 37 fill in the blank 38 fill in the blank 39 Dec. 31 Dec. 31 Dec. 31 Dec. 31 fill in the blank 43 fill in the blank 44 fill in the blank 45 fill in the blank 46 fill in the blank 47 fill in the blank 48 Dec. 31 Balances Dec. 31

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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Question

Perpetual inventory using FIFO

Beginning inventory, purchases, and sales data for prepaid cell phones for December are as follows:

Inventory

Date	Units and Cost
Dec. 1	120 units at $20

Purchases

Date	Units and Cost
Dec. 10	60 units at $22
20	54 units at $24

Sales

Date	Units
Dec. 12	84 units
14	72 units
31	36 units

Assume that the business maintains a perpetual inventory system, costing by the first-in, first-out method. Determine the cost of 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.

FIFO MethodPrepaid Cell Phones

Date	Purchases Quantity	Purchases Unit Cost	Purchases Total Cost	Cost of Goods Sold Quantity	Cost of Goods Sold Unit Cost	Cost of Goods Sold Total Cost	Inventory Quantity	Inventory Unit Cost	Inventory Total Cost
Dec. 1							Dec. 1	Dec. 1	Dec. 1
Dec. 10	Dec. 10	Dec. 10	Dec. 10				Dec. 10	Dec. 10	Dec. 10
							fill in the blank 10	fill in the blank 11	fill in the blank 12
Dec. 12				Dec. 12	Dec. 12	Dec. 12	Dec. 12	Dec. 12	Dec. 12
							fill in the blank 19	fill in the blank 20	fill in the blank 21
Dec. 14				Dec. 14	Dec. 14	Dec. 14
				fill in the blank 25	fill in the blank 26	fill in the blank 27	fill in the blank 28	fill in the blank 29	fill in the blank 30
Dec. 20	Dec. 20	Dec. 20	Dec. 20				Dec. 20	Dec. 20	Dec. 20
							fill in the blank 37	fill in the blank 38	fill in the blank 39
Dec. 31				Dec. 31	Dec. 31	Dec. 31
				fill in the blank 43	fill in the blank 44	fill in the blank 45	fill in the blank 46	fill in the blank 47	fill in the blank 48
Dec. 31	Balances					Dec. 31