Valix Finacc vol 1 Problem 8-37

Financial Accounting Volume 1 2008 Valix-Peralta
Chapter 1 Problem 8-37

                                                                                                          Cost                Retail                      

Inventory, January 1, 2008                                                                 420,000            600,000     

Purchases adjusted for markup and markdown        72%             5,011,200         6,960,000

Goods available for sale                                                                5,431,200         7,560,000

Sales – 2008                                                                                                          (6,839,000)

Inventory, December 31, 2008                                                                     721,000

FIFO cost (721,000 x 72%)                                                                   519,120

                                               

Inventory, January 1, 2009                                                               519,120            721,000     

Purchases adjusted                                                      70%          4,970,000         7,100,000

Goods available for sale                                                              5,489,120         7,821,000

Sales – 2009                                                                                                         (7,033,000)

Inventory, December 31, 2009                                                                    788,000

FIFO cost (788,800 x 70%)                                                                  551,600