Wildhorse Co. has the following inventory data: July 1 Beginning inventory 102 units at $19 $1938
7 Purchases 357 units at $20 7140
22 Purchases 51 units at $22 1122 $10200
A physical count of merchandise inventory on July 30 reveals that there are 170 units on hand. Using the FIFO inventory method, the amount allocated to ending inventory for July is:.
a. $6698.
b. $3298.
c. $3502.
d. $6902.

Wildhorse Co.

Using the FIFO inventory method, the amount allocated to ending inventory for July is:.

c. $3502.

Explanation:

a) Data and Calculations:

Date          Description                 Units      Unit Cost     Total Cost

July 1         Beginning inventory     102           $19               $1,938

July 7        Purchases                    357           $20                 7,140

July 22     Purchases                       51           $22                 1,122

July 30     Total available for sale 510                             $10,200

July 30     Ending inventory          170

July 30     Units sold                    340

Value of Ending inventory using FIFO:

Date          Description                Units     Unit Cost     Total Cost

July 7        Purchases                    119           $20             $2,380    

July 22     Purchases                     51           $22                  1,122

Total value of ending inventory  170                               $3,502

Cost of goods sold using FIFO:

Cost of goods available for sale = $10,200

Less Ending inventory                       3,502

Cost of goods sold                          $6,698