Question

Sally buys and sells bottled water during the hot summer months.
Below are information for the month of August 2019:
			Unit
		Units	Cost	$ Amount
Aug. 1st. Inventory		100	$1.00	$100.00
Aug. 3rd. Purchase		150	$1.10	$165.00
Aug. 13th. Purchase		250	$1.25	$312.50
Aug. 16th. Purchase		110	$1.45	$159.50
Aug. 25th. Purchase		50	$1.50	$75.00
				$812.00
A total of 610 bottles were sold during the month of
August 2019. Please calculate the $ amount for the
Ending Inventory using the FIFO cost flow assumption.
(ONLY write the
answer in the Diagonal Box)

Answer 1

		Unit
		Units	Cost	$ Amount
Aug. 1st. Inventory		100	$1.00	$100.00
Aug. 3rd. Purchase		150	$1.10	$165.00
Aug. 13th. Purchase		250	$1.25	$312.50
Aug. 16th. Purchase		110	$1.45	$159.50
Aug. 25th. Purchase		50	$1.50	$75.00
		660		$812.00

Number of units available for sale = 660

Number of units sold = 610

ending inventory = Number of units available for sale- Number of units sold

= 660-610

= 50 units

As per FIFO method, ending inventory consists of the units purchased later.

Hence, ending inventory will be valued as under:

		Unit
		Units	Cost	$ Amount
Aug. 25th. Purchase		50	$1.50	$75.00

Cost of ending inventory = $75.

Kindly comment if you need further assistance.

Thanks‼!