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Inventory records for Dunbar Incorporated revealed the following:

Date Transaction Number of Units Unit Cost
Apr. 1 Beginning inventory 410 $2.33
Apr. 20 Purchase 380 2.74

Dunbar sold 640 units of inventory during the month. Ending inventory assuming FIFO would be (Do not round your intermediate calculations. Round your answer to the nearest dollar amount):
A. $349.
B. $955.
C. $411.
D. $1,123.

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agustinsr99

Answer: The correct answer is "C. $411.".

Explanation: The inventory before the sale is:

Date   Transaction          Number of Units        Unit Cost      Total Cost

Apr.1   Beginning Inv.             410                        $2,33            $955,30

Apr.20   Purchase                  380                       $2,74            $1041,20

The sale according to the FIFO (First in - First out) system would be:

Transaction          Number of Units        Unit Cost      Total Cost

   Sales                      410                          $2,33          $955,30

                                  230                         $2,74          $630,20

                                                                           Total:  $1585,50

Ending inventory is:

Number of Units        Unit Cost      Total Cost

  150 (380-230)            $2,74            $411

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