Laird Company sells coffee makers used in business offices. Its beginning inventory of coffee makers was 200 units at $41 per unit. During the year, Laird made two batch purchases of coffee makers. The first was a 295-unit purchase at $46 per unit; the second was a 380-unit purchase at $48 per unit. During the period, Laird sold 845 coffee makers.

What's the cost of goods sold with FIFO method?

To calculate the cost of goods sold using the FIFO (First-in, First-out) method, you need to assume that the units sold are taken from the beginning inventory first, then from the most recent purchases.

Step 1: Calculate the cost of the coffee makers sold from the beginning inventory.
To find this, multiply the number of units sold (845) by the cost per unit from the beginning inventory ($41).
Cost of goods sold from the beginning inventory = 845 units * $41 per unit = $34,645

Step 2: Calculate the cost of the coffee makers sold from the first batch purchase.
To find this, take the remaining units of the first batch purchase after deducting the units sold from the beginning inventory (845 - 200 = 645) and multiply it by the cost per unit from the first batch purchase ($46).
Cost of goods sold from the first batch purchase = 645 units * $46 per unit = $29,670

Step 3: Calculate the cost of the coffee makers sold from the second batch purchase.
To find this, take the remaining units of the second batch purchase after deducting the units sold from the beginning inventory and the first batch purchase (845 - 200 - 295 = 350) and multiply it by the cost per unit from the second batch purchase ($48).
Cost of goods sold from the second batch purchase = 350 units * $48 per unit = $16,800

Step 4: Calculate the total cost of goods sold.
To find this, sum up the costs of goods sold from the beginning inventory, the first batch purchase, and the second batch purchase.
Total cost of goods sold = $34,645 + $29,670 + $16,800 = $81,115

Therefore, the cost of goods sold with the FIFO method is $81,115.