Sandra's Purse Boutique has the following transactions related to its top-selling Gucci purse for the month of October

Accounting Dec 19, 2020

Sandra's Purse Boutique has the following transactions related to its top-selling Gucci purse for the month of October. Sandra's Purse Boutique uses a periodic inventory system.

Date TransactionsUnits Unit Cost Total CostOctober1 Beginning inventory 6 $740 $4,440 October4 Sale 4 October10 Purchase 5 750 3,750 October13 Sale 3 October20 Purchase 4 760 3,040 October28 Sale 7 October30 Purchase 7 770 5,390 $16,620

Using FIFO, calculate ending inventory and cost of goods sold at October 31.

Expert Solution

Ending inventory= No. of units in ending inventory* Cost

= (7* 770)+ (1* 760)

= 5390+ 760

= 6150

Cost of goods sold= Total goods available- Ending inventory

= 16620- 6150

= 10470

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