Question

Sanfillipo, Inc., had 800 units of inventory on hand at March 1 of the current year, costing $20 each. Purchases and sales of inventory during the month of March were as follows: Date Purchases Sales March 8 600 units 15 400 units @ $22 each 22 400 units @ $24 each 27 400 units Sanfillipo uses the perpetual inventory system. According to a physical count, 600 units were on hand at the end of March. The cost of goods sold for March applying the FIFO method is:

Answer 1

Answer:

According to a physical count, 600 units were on hand at the end of March. The cost of goods sold for March applying the FIFO method is:

$1081600

Explanation:

MARCH 1  800 20  

MARCH 8 8600 22  

MARCH 8 15400 22  

MARCH 8 22400 24  

MARCH 8 27400 24  

Final Inv.   600    

Sell units        74000    

   

FIFO Purch. Unit cost Sell Un. Cost

MARCH 1  800 20 800         16000

MARCH 8 8600 22 8600 189200

MARCH 8 15400 22 15400 338800

MARCH 8 22400 24 22400 537600

MARCH 8 27400 24 26800 643200

                           74000 1081600

Answer 2

Answer:

$20,400

Explanation:

Sanfillipo's merchandise inventory during March:

Date                        Units purchased                      Cost per unit

March 1                             800                                      $20

March 15                           400                                      $22

March 22                          400                                      $24  

total                                1,600

Since the ending inventory was only 600 units, it means that Sanfillipo sold 1,000 units. Using the FIFO method, the cost of goods sold was:

800 units x $20 = $16,000

200 units x $22 = $4,400

total COGS = $20,400