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During the year, wright Company sels 420 remote-control airplanes for $120 each.

ID: 2580980 • Letter: D

Question

During the year, wright Company sels 420 remote-control airplanes for $120 each. The company has the following inventory purchase transactions for the year Date Jan, 1 May 5 Purchase Nov. 3 Purchase Number of Units 40 225 175 Transaction Beginning inventory Unit Cost Total Cost S77 3,080 18,000 14,875 3 80 85 440 S 35,955 Calculate ending inventory and cost of goods sold for the year, assuming the company uses FIFO FIFO Cost of Goods Available for Sale Cost of Goods Sold Cost of | Average | Goods | units # of units, cost per l Available unit ! # of units Cost per! Average Cost of Goods Sold |#of units,cost Average Ending unit for Sale er unit Invento Beginning Inventory Purchases May 5 Nov. 3

Explanation / Answer

Answer: FIFO Cost of goods available for sales Cost of Goods sold Ending Inventory # of units Average cost per unit Cost of goods available for sale # of units Average cost per unit Cost of goods available for sale # of units Average cost per unit Ending Inventory Beginning Inventory 40 $                         77 $                   3,080 40 $                         77 $                   3,080 Purchases 5-May 225 $                         80 $                18,000 225 $                         80 $                18,000 3-Nov 175 $                         85 $                14,875 155 $                         85 $                13,175 20 $                         85 $                   1,700 Total 440 $                35,955 420 $                34,255 20 $                   1,700 Note: 1 Since we are using FIFO 20 units from units prchased on 3rd November would be left in inventory.

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