Test: CPA Financial Accounting and Reporting (FAR)

1.

A company buys 100 units of inventory for $20 each. Later, 90 of these units are sold on credit for $50 each. The company then buys an additional 40 units but the cost has risen to $22 each. The company sells a final 30 units for $55 each. The company uses a moving average system for calculating its cost of goods sold. What should be reported as the cost of the 120 units sold during the year?

$2,448

$2,538

$2,468

$2,592

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