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Basic Question 26 of 26
Beginning inventory: 10 units @ $10 per unit
First purchase: 35 units @ $11 per unit
Second purchase: 40 units @ $12 per unit
Third purchase: 15 units @ $13 per unit
B. $905
C. $177
First purchase: 35 units @ $11 per unit
Second purchase: 40 units @ $12 per unit
Third purchase: 15 units @ $13 per unit
If 83 units are sold, what is the value of the ending inventory under a periodic inventory system and a FIFO cost flow assumption?
A. $219
B. $905
C. $177
User Contributed Comments 6
| User | Comment |
|---|---|
| kalps | Ok, remember: Perpetual constantly updated - so closing stock will be know as record kept throughout year. Periodic, the CS valuation is calculated looking at the period in question as above |
| spenja | Still a bit confused between the two. What would be the answer in this case if a perpetual inventory system was used? |
| gill15 | Same answer....FIFO doesnt change under perpetual or periodic.....LIFO and Weighted AVG are different between tow. |
| johntan1979 | Actually, for this question specifically only, since the date of sale was not specified, thus, the result for perpetual or periodic LIFO and weighted average would still be the same. |
| wsobocin | yea same accounting period so it doesn't matter |
| LoweJoseph | why aren't all 17 units multiplied by $13? |
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Tamara Schultz
Learning Outcome Statements
describe the measurement of inventory at the lower of cost and net realisable value and its implications for financial statements and ratios
CFA® 2024 Level I Curriculum, Volume 2, Module 6.