Perpetual inventory using FIFO

Beginning inventory, purchases, and sales data for prepaid cell phones for December are as follows:

Inventory

Dec. $1220$ units at $$40$

Purchases

Dec. $10110$ units at $$42$

$2099$ units at $$44$

Sales

Dec. $12154$ units

$14132$ units

$3166$ units

Assume that the business maintains a perpetual inventory system, costing by the first$-$in$,$ first$-$out method. Determine the cost of goods sold for each sale and the inventory balance after each sale, presenting the data in the form illustrated in Exhibit $3.$ Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit cost column and in the Inventory Unit cost column.

FIFO Method

Prepaid Cell Phones

Cost of Cost of Cost of

Purchases Purchases Purchases Goods Sold Goods Sold Goods Sold Inventory Inventory Inventory