If you bought 50 units at $4 and then 50 at $5, and you sell 60, FIFO counts the cost as 50 × $4 + 10 × $5 = $250. The 40 units left are valued at $5 each. It's one of the common ways to value inventory, alongside weighted average cost. Your accountant can tell you which suits your business.
Glossary
FIFO (first in, first out)
A way of costing inventory that assumes the first units you bought are the first ones you sell.