At the Beginning of the Year Pace Company Had an Inventory

question 74

Multiple Choice

At the beginning of the year Pace Company had an inventory of $750000. During the year the company purchased goods costing $2400000. If Pace Company reported ending inventory of $758000 and sales of $3680000 the company's cost of goods sold and gross profit rate must be

• A) $1288000 and 53.8%.
• B) $2392000 and 35%.
• C) $1288000 and 35%.
• D) $2392000 and 65%.

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Definitions:

FICA Taxes

Taxes levied on both employees and employers to fund Social Security and Medicare.

SUTA Taxes

State Unemployment Tax Act taxes are state unemployment taxes employers are required to pay to provide funds for paying unemployment compensation to laid-off employees.

Form 1040-ES

A form used by taxpayers, primarily self-employed individuals, to estimate and pay their quarterly taxes to the IRS.

Estimated Payments

Quarterly payments made towards the expected tax liability for the year, common for self-employed individuals or those without sufficient tax withholding.