A Company Just Starting in Business Purchased Three Merchandise Inventory

question 26

Multiple Choice

A company just starting in business purchased three merchandise inventory items at the following prices. First purchase $64; Second purchase $76; Third purchase $68. If the company sold two units for a total of $200 and used FIFO costing, the gross profit for the period would be

• A) $56.
• B) $60.
• C) $62.
• D) $68.

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Definitions:

Manufactured Goods

Products that have been produced from raw materials through various processes in factories, ranging from electronics to clothing.

Handwork

Manual or skilled labor involving the use of the hands and tools rather than machinery, often associated with crafts, artisanal production, and traditional techniques.

Machine Driven Industry

Industries that rely heavily on machinery and technology for production processes, marking a shift from manual to mechanized labor.

American Workers

Individuals employed in the United States, contributing to its economy and labor market.