Ask Question
7 January, 02:49

Assume that we use a perpetual inventory system and that five identical units are purchased separately at the following four dates and costs: April 5 at $10, April 10 at $12, April 15 at $14, and April 20 at $16 April 20 $17. One unit is then sold on April 25. The company uses the first-in, first-out (FIFO) inventory costing method. Identify whether each of the items purchased will be sent to cost of goods sold on the income statement or reported in inventory on the balance sheet using the drop-down list.

+5
Answers (1)
  1. 7 January, 02:51
    0
    The cost of goods sold (income statement) should include 1 unit purchased on April 5 at $10.

    The merchandise inventory account (balance sheet) should include the 4 units purchased later including their purchase date and specific cost:

    1 unit purchased on April 10 at $12 1 unit purchased on April 15 at $14 1 unit purchased on April 20 at $16 1 unit purchased on April 20 at $17
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Assume that we use a perpetual inventory system and that five identical units are purchased separately at the following four dates and ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers