EX 6-3 Perpetual inventory using FIFO

EX 6-3 Perpetual inventory using FIFO

Beginning inventory, purchases, and sales data for portable DVD players are as follows:

April 1

Inventory

120 units at $39

6

Sale

90 units

14

Purchase

140 units at $40

19

Sale

110 units

25

Sale

45 units

30

Purchase

160 units at $43

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.

 

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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