Beginning inventory, purchases and sales data for tennis rackets are as follows:

Question

Beginning inventory, purchases and sales data for tennis rackets are as follows: Apr. 03 Inventory 20 units $15.00 Apr. 11 Purchase 18 units $19.00 Apr. 14 Sale 10 units Apr. 21 Purchase 13 units $20.00 Apr. 25 Sale 15 units Assuming the business maintains a perpetual inventory system, calculate the cost of merchandise sold and ending inventory under First-in, first-out. Select the correct answer. cost of merchandise sold $395.00 ending inventory $902.00 cost of merchandise sold $902.00 ending inventory $507.00 cost of merchandise sold $395.00 ending inventory $507.00 cost of merchandise sold $507.00 ending inventory $395.00

Explanation / Answer

Opening purchases sales closing unit cost/unit ($) total unit cost/unit ($) total unit cost/unit ($) total unit cost/unit ($) total 3-Apr 20 $15 300 - - - - - - 20 $15 300 11-Apr - - - 18 $19 $342 - - - 20 $15 300 18 $19 $342 14-Apr - - - - - - 10 $15 $150 10 $15 $150 18 $19 $342 21-Apr - - - 13 $20 $260 - - - 10 $15 $150 18 $19 $342 13 $20 $260 25-Apr - - - - - - 10 $15 $150 13 $19 $247 5 $19 $95 13 $20 $260 TOTAL 20 $15 $300 31 $602 25 $395 153 2693 Cost of merchandise sold = $395 Closing Inventory unit cost/unit ($) total 11-Apr 13 $19 $247 21-Apr 13 $20 $260 $507

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