### Inventory Information for Misty Roads IncorporatedThe following information pertains to the inventory of Misty Roads Incorporated:| Date | Transaction | Quantity | Cost ||------------|-------------------|----------|------|| March 1 | Beginning Inventory | 20 | $2 || March 7 | Purchase | 15 | $3 || March 12 | Purchase | 20 | $4 |A physical count revealed that 30 units remained on hand as of March 31. Using the FIFO (First-In, First-Out) cost flow assumption, calculate the ending inventory value that Misty Roads would report.- [ ] $110- [ ] $70- [ ] $55- [ ] $170### Solution ExplanationUnder FIFO, the cost of the oldest inventory is used first when calculating the cost of goods sold. Therefore, the ending inventory includes the most recent purchases.Calculate the ending inventory value by considering the remaining 30 units in the inventory:1. **20 units at $4 (latest purchase on March 12):** \[ 20 \times 4 = 80 \]2. **10 units at $3 (from purchase on March 7):** \[ 10 \times 3 = 30 \]Total ending inventory value: \[80 + 30 = 110\]Therefore, the ending inventory reported under FIFO is **$110**.

FIFO, or First-In, First-Out, is an inventory management method where the oldest items in stock are…

The following information relates Transaction Quantity Date March 1 Beginning Inventory 20 March 7 Purchase 15 March 12 Purchase 20 Cost O $110 $70 $55 $170 $2 $3 $4 A physical count revealed 30 units remained on hand at March 31. At what amount would Misty Roads report ending inventory using FIFO cost flow assumptions?

The following information relates Transaction Quantity Date March 1 Beginning Inventory 20 March 7 Purchase 15 March 12 Purchase 20 Cost O $110 $70 $55 $170 $2 $3 $4 A physical count revealed 30 units remained on hand at March 31. At what amount would Misty Roads report ending inventory using FIFO cost flow assumptions?

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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