Priscilla Has the Following Inventory Information

question 51

Multiple Choice

Priscilla has the following inventory information. A physical count of merchandise inventory on July 31 reveals that there are 35 units on hand. Using the average-cost method, the value of ending inventory is

• A) $680.
• B) $704.
• C) $723.
• D) $730.

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Definitions:

Journal entry

A record in accounting that documents a business transaction and its impact on the company's accounts, using debits and credits.

Cost of merchandise sold

The total expense incurred by a company to buy or manufacture the goods sold during a given period.

Specific identification inventory costing method

An inventory valuation method where costs are attributed to individual items of inventory, enabling precise matching of costs with revenues when the specific items are sold.

Companies

Legal entities formed by individuals, stockholders, or shareholders, with the purpose of engaging in commercial or industrial activities.