Question

Kenyon Co. uses the perpetual inventory method. Kenyon purchased 400 units of inventory that cost $6.00 each. At a later date the company purchased an additional 600 units of inventory that cost $8.00 each. If Kenyon uses the FIFO cost flow method and sells 800 units of inventory, the amount of cost of goods sold will be:_______-

Answer 1

Answer:$5600

Explanation:

The FIFO inventory system is an inventory system where the inventory purchased first is the first to be sold.

If 800 units are sold, the inventory sold would be calculated as:

$6 × 400 = $2,400

$8 × 400 = $3200

=$5,600