Perpetual Inventory Using FIFO Beginning inventory, purchases, and sales for Item PK95 are as follows: May 1 Inventory 67 units $19 9 Sale 44 units 13 Purchase 72 units $20 Sale 27 units Assuming a perpetual inventory system and using the first-in, first-out (FIFO) method, determine (a) the cost of merchandise sold on May 28 and (b) the inventory on May 31. a. Cost of merchandise sold on May 28 $ s b. Inventory on May 31 Check My Wor a. When the FIFO method is used, costs are included in cost of merchandise sold in the order in which they were purchased Think of your inventory in terms of layer Determine how much inventory remains from each layer after each sale. b. The ending inventory is made up of the most recent purchases