During July, the following purchases and sales were made by Big Dan Company. The

Question

During July, the following purchases and sales were made by Big Dan Company. There was no beginning inventory. Big Dan Company uses a perpetual inventory system.

                       Purchases                                               Sales
July   3             40 units @ $12                  July 13          50 units
11                   40 units @ $13                         22         20 units
20                   20 units @ $15

Under the FIFO method, the cost of goods sold for each sale is:
July 13                    July 22

Answer

$600                  $240

610                    260

650                    260

750                    300

$600                  $240

610                    260

650                    260

750                    300

Explanation / Answer

Answer:- July13 - $610 and July22 - 260

Purchases Sales Balance

Date Unit Unit Cost Total Unit Unit Cost Total Unit Unit Cost Total July 3 40 12 480 40 12 480 July 11 40 13 520 40 12 480 40 13 520 July13 40 12 480 10 13 130 30 13 390 July20 20 15 300 30 13 390 20 15 300 July22 20 13 260

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