Denton Hardware Had Beginning Inventory of $44,000 on January 1

question 95

Essay

Denton Hardware had beginning inventory of $44,000 on January 1, 2012. During 2012, Denton purchased $610,000 of goods from a supplier. On December 31, 2012, the cost of unsold inventory was $50,000. Compute Denton's cost of goods available for sale and cost of goods sold for 2012.

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Definitions:

Biological Assets

Living plants or animals that are used in agricultural activities from which agricultural produce is harvested, accounted for under specific accounting standards.

Fair Value

An estimate of the price at which an asset or liability could be exchanged in a current transaction between willing parties.

AASB 141

An Australian Accounting Standards Board standard that concerns agriculture, detailing the accounting for agricultural activity including the transformation of biological assets (living plants and animals) into agricultural produce.

IAS 41

The International Accounting Standard that deals with the accounting for agriculture, including the recognition and measurement of biological assets.