Question
Hammer Co. is in the business of buying hammers at wholesale prices and reselling them at retail prices. The following information for the month of
Hammer Co. is in the business of buying hammers at wholesale prices and reselling them at retail prices. The following information for the month of February was collected by Hammer Co.'s Purchase and Sales departments:
Date | Transactions | Units | Unit cost/sales price | |
Feb 4 | Beginning inventory | 300 | $ | 15 |
9 | Purchase | 100 | 18 | |
12 | Sale | 320 | 27 | |
17 | Purchase | 150 | 20 | |
26 | Sale | 100 | 30 | |
If the company uses a FIFO cost flow assumption, what was the cost of the inventory on hand after the February 26th sale if a periodic inventory system and a perpetual inventory system was used?
Multiple Choice
Periodic System $2,200 Perpetual System $2,600
Periodic System $2,600 Perpetual System $2,200
Periodic System $2,200 Perpetual System $1,950
Periodic System $2,600 Perpetual System $2,600
None of the other alternatives are correct
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