The Following Data Pertain to Stratus Company for the Year

question 134

Essay

The following data pertain to Stratus Company for the year ended December 31, 2019: $\begin{array}{lr}\text { Beginning inventory balance } & \$ 245,500 \\\text { Purchases of inventory on credit during year }& 570,000 \\\text { Sales (40\% on credit) during year } & 780,000 \\\text { Cost of goods sold during year } & 550,000\end{array}$ Required:
1. Calculate the value of ending inventory on December 31, 2019.
2. Determine the gross margin

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Definitions:

Journal Entry

A record in accounting journals that represents a business transaction and includes details like date, amounts, and accounts affected.

Semiannual Interest Payment

A type of interest payment made twice a year on bonds or other fixed-income securities.

Journal Entry

A record in accounting that represents a transaction and its effect on various accounts within the financial statements.

Trading Securities

Financial instruments held by a firm for the purpose of short-term profit through trading on a stock exchange.