Question

Blue Spruce Company sells many products. Gizmo is one of its popular items. Below is an analysis of the inventory purchases and sales of Gizmo for the month of March. Blue Spruce Company uses the periodic inventory system.

Purchases Sales

Units Unit Cost Units Selling Price/Unit

3/1 Beginning inventory 122 $30

3/3 Purchase 69 $40

3/4 Sales 69 $70

3/10 Purchase 244 $45

3/16 Sales 77 $80

3/19 Sales 114 $80

3/25 Sales 69 $80

3/30 Purchase 53 $50

Using the FIFO assumption, calculate the amount charged to cost of goods sold for March.

Answer 1

Ans.	Periodic FIFO:
	Date	Units	Rate	Total
	01-Mar	122	$30.00	$3,660
	03-Mar	69	$40.00	$2,760
	10-Mar	138	$45.00	$6,210
	Cost of goods sold	329		$12,630
	*In FIFO method the units that have purchased first (earliest), are released the first one and the ending inventory
	units remain from the last (recent) purchases.
	*Calculations for Total units sold :
	Date	Units sold
	04-Mar	69
	16-Mar	77
	19-Mar	114
	25-Mar	69
	Total units sold	329