Question

A company has beginning inventory of 19 units at a cost of $19 each on February 1. On February 3, it purchases 29 units at $21 each. 25 units are sold on February 5. Using the FIFO periodic inventory method, what is the cost of the 25 units that are sold?

Multiple Choice

• $487

• $504

• $491

• $494

• $475

Answer 1

FIFO periodic Inventory Method

Date	Purchase	Sales	Balance
	Quantity	Rate	Total	Quantity	Rate	Total	Quantity	Rate	Total
Feb 1							19	$19	$361
Feb 3	29	$21	$609				19	$19	$361
							29	$21	$609
Feb 5				19	$19	$361
				6	$21	$126	23	$21	$483
Total/Balance	29		$609	25		$487	23	$21	$483

So cost of 25 Units sold is $487.