Question

Aiello, Inc. had the following inventory in fiscal 2016. The company uses the FIFO method of accounting for inventory. Beginning Inventory, January 1, 2016: 130 units @ $15.00 Purchase 200 units @ $18.00 Purchase 50 units @ $13.50 Purchase 110 units @ $15.75 Ending Inventory, December 31, 2016: 120 units The company’s cost of goods sold for fiscal 2016 is:

Answer 1

COGS= $6090

Step-by-step explanation:

Giving the following information:

Beginning Inventory, January 1, 2016: 130 units at $15.00

Purchase 200 units at $18.00

Purchase 50 units at $13.50

Purchase 110 units at $15.75

Ending Inventory, December 31, 2016: 120 units

We need to calculate the cost of goods sold.

First, we determine the number of units sold:

Units sold= beginning inventory + purchases - ending inventory

Units sold= 130 + 360 - 120= 370 units

Now, we can calculate the COGS

Inventory method: FIFO (First-in, first-out).

COGS= 130*$15 + 200*$18 + 40*13.5= $6090