Given the Following: FIFO Method: 16 Units Left in Inventory

question 50

Multiple Choice

Given the following: FIFO method: 16 units left in inventory
$$\begin{array} { | l | l | l | } \hline \text { Jan 1 } & \text { Beginning Inventory } & 9 \text { units at } \$ 105 = \$ 945 \\\hline \text { April 13 } & \text { Purchased } & 14 \text { units at } \$ 120 = \$ 1,680 \\\hline \text { Sept 17 } & \text { Purchased } & 20 \text { units at } \$ 130 = \$ 2,600 \\\hline \text { Dec 10 } & \text { Purchased } & 14 \text { units at } \$ 140 = \$ 1,960 \\\hline\end{array}$$ The cost of goods sold is:

• A)$5,000
• B)$10,000
• C)$4,965
• D)$5,225
• E)None of these

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Definitions:

Gross Sales

The gross sales income of a business before subtracting any returns, allowances, or discounts.

Credit Sales

Sales transactions where payment is not received at the time of purchase but is instead deferred to a later date.

Cash Sales

Transactions where goods or services are paid for with cash at the time of the sale.

Sales Discount

is a reduction in the listed price of a product or service offered to customers as an incentive to prompt payment.