At the Beginning of the Year, Uptown Athletic Had an Inventory

question 132

Multiple Choice

At the beginning of the year, Uptown Athletic had an inventory of $600,000.During the year, the company purchased goods costing $2,250,000.If Uptown Athletic reported ending inventory of $750,000 and sales of $3,000,000, their cost of goods sold and gross profit rate would be

• A)$1,500,000 and 70%.
• B)$2,100,000 and 30%.
• C)$1,500,000 and 30%.
• D)$2,100,000 and 70%.

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Definitions:

Financing Costs

Financing costs are expenses incurred by an entity in the process of borrowing funds, including interest payments and other related fees.

Market Value

The ongoing trading value of an asset or service in the market.

Preferred Stock

A type of stock that provides holders with a fixed dividend prior to any dividend payments to common stockholders, and typically does not carry voting rights.

Common Stock

A form of corporate equity ownership, representing a share in the ownership of a company and a claim on a portion of its profits.