use the following information for the quick study below. (algo) (11-14)\nthe following information applies…

use the following information for the quick study below. (algo) (11-14)\nthe following information applies to the questions displayed below.\ntrey monson starts a merchandising business on december 1 and enters into the following three inventory purchases. monson uses a periodic inventory system. also, on december 15, monson sells 18 units for $10 each.\npurchases on december 7: 8 units @ $4.00 cost\npurchases on december 14: 26 units @ $6.00 cost\npurchases on december 21: 18 units @ $7.00 cost\nqs 5-11 (algo) periodic: inventory costing with fifo lo p1\ndetermine the costs assigned to ending inventory when costs are assigned based on the fifo method.\nperiodic fifo:\n| | goods available for sale | cost of goods sold | ending inventory |\n|--|--|--|--|--|\n| | # of units | cost per unit | cost of goods available for sale | # of units sold | cost per unit | cost of goods sold | # of units in ending inventory | cost per unit | ending inventory |\n| purchases | | | | | | | | |\n| december 7 | 8 | $4.00 | $32 | | | | | |\n| december 14 | 26 | $6.00 | $156 | | | | | $6.00 |\n| december 21 | 18 | $7.00 | $126 | | | | | $7.00 |\n| total | 52 | | $314 | | | | | |

use the following information for the quick study below. (algo) (11-14)\nthe following information applies to the questions displayed below.\ntrey monson starts a merchandising business on december 1 and enters into the following three inventory purchases. monson uses a periodic inventory system. also, on december 15, monson sells 18 units for $10 each.\npurchases on december 7: 8 units @ $4.00 cost\npurchases on december 14: 26 units @ $6.00 cost\npurchases on december 21: 18 units @ $7.00 cost\nqs 5-11 (algo) periodic: inventory costing with fifo lo p1\ndetermine the costs assigned to ending inventory when costs are assigned based on the fifo method.\nperiodic fifo:\n| | goods available for sale | cost of goods sold | ending inventory |\n|--|--|--|--|--|\n| | # of units | cost per unit | cost of goods available for sale | # of units sold | cost per unit | cost of goods sold | # of units in ending inventory | cost per unit | ending inventory |\n| purchases | | | | | | | | |\n| december 7 | 8 | $4.00 | $32 | | | | | |\n| december 14 | 26 | $6.00 | $156 | | | | | $6.00 |\n| december 21 | 18 | $7.00 | $126 | | | | | $7.00 |\n| total | 52 | | $314 | | | | | |

Answer

Explanation:

Step1: Calculate units available for sale

Total units available for sale = 8 + 26+18 = 52 units.

Step2: Determine units sold

18 units are sold on December 15.

Step3: Allocate units for cost - of - goods - sold under FIFO

Under FIFO (First - In, First - Out), the 18 units sold will come from the earliest purchases. First, take 8 units from the December 7 purchase (cost per unit = $4.00) and 10 units from the December 14 purchase (cost per unit = $6.00). Cost of goods sold = (8×$4)+(10×$6) = $32 + $60=$92.

Step4: Calculate ending inventory units and cost

Ending inventory units = 52 - 18=34 units. The ending inventory consists of 16 units from the December 14 purchase (26 - 10) at $6.00 per unit and 18 units from the December 21 purchase at $7.00 per unit. Cost of ending inventory = (16×$6)+(18×$7) = $96 + $126 = $222.

Answer:

$222