Northwest Fur Company started 2024 with $101,000 of inventory on hand. During 2024, $510,000 in inventory was purchased on account with credit terms of 1/15, n/45. All discounts were taken. Purchases were all made f.o.b. shipping point. Northwest paid freight charges of $8,500. Inventory with an invoice amount of $4,600 was returned for credit. Cost of goods sold for the year was $375,000. Northwest uses a perpetual inventory system. What is ending inventory assuming Northwest uses the gross method to record purchases? Options are A)238,846 B)234,786 C)239,900 D)244,500
Northwest Fur Company started 2024 with $101,000 of inventory on hand. During 2024, $510,000 in inventory was purchased on account with credit terms of 1/15, n/45. All discounts were taken. Purchases were all made f.o.b. shipping point. Northwest paid freight charges of $8,500. Inventory with an invoice amount of $4,600 was returned for credit. Cost of goods sold for the year was $375,000. Northwest uses a perpetual inventory system. What is ending inventory assuming Northwest uses the gross method to record purchases? Options are A)238,846 B)234,786 C)239,900 D)244,500
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Northwest Fur Company started 2024 with $101,000 of inventory on hand. During 2024, $510,000 in inventory was purchased on account with credit terms of 1/15, n/45. All discounts were taken. Purchases were all made f.o.b. shipping point. Northwest paid freight charges of $8,500. Inventory with an invoice amount of $4,600 was returned for credit. Cost of goods sold for the year was $375,000. Northwest uses a perpetual inventory system.
What is ending inventory assuming Northwest uses the gross method to record purchases?
Options are
A)238,846
B)234,786
C)239,900
D)244,500
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education