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A company values its inventory using the FIFO method. At 1 January 20X5 the company has 800 widgets in inventory, valued at $75 each.
During the year ended 31 December 20X5 the following transactions took place:20X5
1 February Purchased 500 widgets At $80 each
1 May Sold 400 widgets For $45, 000
1 August Purchased 450 widgets At $69 each
15 Nov Sold 450 widgets For $28,750What is the value of the company’s closing inventory of widgets at 31 December 20X5?
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$67,050.
Closing units = 800+500-400+450-450=900 units
valued FIFO at =(450 x $69) + (450 x $80) = $67,050@trea2401 said:
$67,050.
Closing units = 800+500-400+450-450=900 units
valued FIFO at =(450 x $69) + (450 x $80) = $67,050Trea thnx for ur answer now its clear to me also 🙂
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trea2401 said:
$67,050.
Closing units = 800+500-400+450-450=900 units
valued FIFO at =(450 x $69) + (450 x $80) = $67,050Anyone Pls explain the reason use 450 x $69 + $450x $80?
Thanks.
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