Question

Calculator Addison, Inc. uses a perpetual inventory system. Below is information about one inventory item for the month of September. Sep. 1 Inventory 20 units at $20 4 Sold 10 units 10 Purchased 30 units at $25 17 Sold 20 units 30 Purchased 10 units at $30 If Addison uses FIFO, the September 30 inventory is

Answer 1

Answer:

Ending inventory= $750

Explanation:

To calculate the ending inventory under FIFO (first-in, first-out), we need to use the cost of the last units incorporate into inventory.

Ending inventory:

Sep. 1= 20*20= 400

Sep. 4= (10*20)= (200)

Sep. 10= 30*25= 750

Sep. 17 (20*25)= (500)

Sep. 30= 10*30= 300

Ending inventory= $750