On May 1, Oriole Company had 450 units of inventory on hand, at a cost of $4.00 each. The company uses a perpetual inventory system. All purchases and sales are on account. A record of inventory transactions for the month of May for the company is as follows: May 4 (a) 14 29 Purchases $4.20 740 @ $4.40 500 Ⓡ $4.68 1.500 @ Cost of goods sold May 3 $ 16 18 FIFO Sales 320 Calculate the cost of goods sold and ending inventory using FIFO. $7.00 1,000 @ $7.00 630 Ⓒ $7.50 7800 @

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in…