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Question - Perpetual inventory using FIFO
Beginning inventory, purchases, and sales data for portable DVD players are as follows:
June 1
Inventory
240 units at $78
June 10
Sale
180 units
June 15
Purchase
280 units at $80
June 20
220 units
June 24
90 units
June 30
320 units at $86
The business maintains a perpetual inventory system, costing by the first-in, first-out method.
a. Determine the cost of the merchandise sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit 4.
b. Based upon the preceding data, would you expect the inventory to be higher or lower using the last-in, first-out method?
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