Assume that Barb City acquires S2,000 of inventory on May 1, 2022,having held no inventory previously. On June 30, 2022, the end of BarbCity's fiscal year, a physical count shows $1,400 still in stock. During2023, $900 of this inventory is used, resulting in a $500 remainingbalance of supplies on June 30, 2023.How should Barb City account for these inventories? Show both thepurchase and consumption methods.

Calculation of closing stock = Opening stock + purchases - consumption = Closing stock

Answered: fiscal yea S900 of t ce of sup

Business

Accounting

fiscal yea S900 of t ce of sup

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Amortized Loans

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Question

Assume that Barb City acquires S2,000 of inventory on May 1, 2022,
having held no inventory previously. On June 30, 2022, the end of Barb
City's fiscal year, a physical count shows $1,400 still in stock. During
2023, $900 of this inventory is used, resulting in a $500 remaining
balance of supplies on June 30, 2023.
How should Barb City account for these inventories? Show both the
purchase and consumption methods.

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