A Company Has Beginning Inventory of 15 Units at a Cost

question 121

Multiple Choice

A company has beginning inventory of 15 units at a cost of $12 each on October 1.On October 5,it purchases 10 units at $13 per unit.On October 12 it purchases 20 units at $14 per unit.On October 15,it sells 30 units.Using the periodic FIFO inventory method,what is the value of the inventory at October 15 after the sale?

• A)$140
• B)$160
• C)$210
• D)$380
• E)$590

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Definitions:

Indirect Method

A cash flow statement preparation method that adjusts net income for changes in non-cash accounts to calculate operating cash flow.

Operating Activities

Operating activities include the primary, day-to-day tasks and transactions related to running a business, which contribute to generating revenue.

Direct Method

A cash flow statement reporting approach that lists major operating cash receipts and payments during a period.

Statement of Cash Flows

A financial report that provides aggregate data regarding all cash inflow and outflow a company receives from its ongoing operations and external investment sources.