A Company Just Starting Business Made the Following Three Inventory

question 90

Multiple Choice

A company just starting business made the following three inventory purchases in February: On Feb 15, there were 300 units sold. The company uses a perpetual inventory system.
-Using the FIFO inventory cost formula, the amount allocated to cost of goods sold for the February 15 sale is

• A) $1,525.
• B) $1875.
• C) $4,950.
• D) $3,075.

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Definitions:

Shares of Stock

Units of ownership in a corporation, representing a portion of the corporation's capital.

Negotiable Instrument

A written document guaranteeing the payment of a specific amount of money, either on demand or at a set time, with the payer's sign.

Enforceable Contract

A valid contract that is legally recognized and that can be upheld in a court of law.

Sales Contract

A legal agreement between two parties for the exchange of goods, services, or property for payment.