Question

At the end of October, Mr. Atkins had 10 very popular small lamp shades that cost him $8.00 each. His next inventory order included 40 more of these shades, but they cost him $9.00 each. During the month of November he sold 22 of the shades. What is the value of these shades in his inventory using. . .

Answer 1

The value of Mr. Atkins's remaining lamp shade inventory is $242 after he sold 22 lamp shades. He originally had 50 lamp shades and used the FIFO method to compute the cost of the remaining 28 shades.

Step-by-step explanation:

The value of Mr. Atkins's remaining lamp shades in inventory after selling some in November can be calculated by determining the cost of the remaining inventory. Initially, he had 10 lamp shades at $8.00 each and purchased an additional 40 shades at $9.00 each. After selling 22 shades, we need to calculate the cost of the remaining 28 shades still in inventory.

Calculation:

Calculate the total number of shades before sales: 10 initial + 40 additional = 50 shades.

Subtract the number of shades sold to find the remaining shades: 50 shades - 22 sold = 28 shades.

Assuming first-in, first-out (FIFO) inventory method, the first 10 shades cost $8.00 each, and the remaining 18 shades cost $9.00 each.

Calculate the total value: (10 × $8.00) + (18 × $9.00) = $80 + $162 = $242.

The value of the remaining inventory is $242.