To determine the amount allocated to the units sold on a FIFO (First-In, First-Out) basis, we calculate step-by-step:

Inventory Data:

1. Beginning Inventory: 40 units at $110 = $4,400
2. Purchase: 240 units at $112 = $26,880
3. Sale: 160 units

FIFO Method (First-In, First-Out):

Under FIFO, the oldest inventory is sold first. Here's how we allocate the 160 units sold:

1. First 40 units come from the beginning inventory:
   $40 \, \text{units} \times 110 \, \text{per unit} = 4,400$

2. Next 120 units come from the July 5 purchase:
   $120 \, \text{units} \times 112 \, \text{per unit} = 13,440$

Total Cost of Goods Sold (COGS):

Add the costs for the 160 units:
$4,400 + 13,440 = 17,840$

Answer:

The amount allocated to the units sold on a FIFO basis is:
c. $17,840

Do you want further clarification or have questions about FIFO? Let me know!

Related Questions:

1. How would the result change under the LIFO (Last-In, First-Out) method?
2. What is the total ending inventory value after the sale?
3. How is the periodic inventory system different from a perpetual system?
4. How would the results differ if prices were decreasing instead of increasing?
5. How do we calculate the average cost per unit in this scenario?

Tip:

In a FIFO system, always start allocating costs from the oldest inventory first.