Question

Kays Diamonds uses a periodic inventory system. The company had five bracelets available for sale this year: one was purchased on June 1 for $1,100, two were purchased on July 9 for $1,250 each, and two were purchased on September 23 for $1,350 each. On December 24, it sold one bracelet. Using the FIFO method, its cost of goods sold for the year ended is:

Answer 1

COGS= $1,100

Step-by-step explanation:

Giving the following information:

June 1: 1 unit for $1,100

July 9: 2 units for $1,250 each

September 23: 2 units for $1,350 each.

On December 24, it sold one bracelet.

Under the FIFO (first-in, first-out) method, the cost of goods sold is calculated using the cost of the firsts units incorporated into the inventory.

COGS= 1units* $1,100= $1,100