Chapter 1 Problem 7-33
1. September 30 (40,000 x 75) 3,000,000
December 31 (10,000 x 90) 900,000
Total FIFO cost 3,900,000
NRV (50,000 x 72) 3,600,000
Loss on inventory writedown 300,000
Inventory – January 1 1,200,000
Purchases 9,400,000
Purchase discount ( 400,000)
Goods available for sale 10,200,000
Less: Inventory – December 31 3,900,000
Cost of goods sold before inventory writedown 6,300,000
Loss on inventory writedown 300,000
Cost of goods sold after inventory writedown 6,600,000
2. Inventory – December 31 3,900,000
Income summary 3,900,000
Loss on inventory writedown 300,000
Allowance for inventory writedown 300,000
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