Question: Cost Flow Methods Three identical units of Item PX2T are purchased during July, as shown below. Item PX2T Units Cost July 9 Purchase 1 $224 July 17 Purchase 1 225 July 26 Purchase 1 226 Total 3 $675 Average cost per unit $225 ($675 / 3 units) Assume that one unit is sold on July 31 for $275. Determine the gross profit for July and ending inventory on July 31 using the ⚫ first-in, first-out (FIFO); Gross Profit, Ending Inventory?
Question: Cost Flow Methods Three identical units of Item PX2T are purchased during July, as shown below. Item PX2T Units Cost July 9 Purchase 1 $224 July 17 Purchase 1 225 July 26 Purchase 1 226 Total 3 $675 Average cost per unit $225 ($675 / 3 units) Assume that one unit is sold on July 31 for $275. Determine the gross profit for July and ending inventory on July 31 using the ⚫ first-in, first-out (FIFO); Gross Profit, Ending Inventory?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Use the FIFO method
Transcribed Image Text:Question:
Cost Flow Methods Three identical
units of Item PX2T are purchased
during July, as shown below. Item
PX2T Units Cost July 9 Purchase 1
$224 July 17 Purchase 1 225 July 26
Purchase 1 226 Total 3 $675 Average
cost per unit $225 ($675 / 3 units)
Assume that one unit is sold on July
31 for $275. Determine the gross
profit for July and ending inventory
on July 31 using the
⚫ first-in, first-out (FIFO);
Gross Profit, Ending Inventory?
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