Holliday Company's Inventory Records Show the Following Data A Physical Inventory on December 31 Shows 2,000 Units on Units

question 32

Multiple Choice

Holliday Company's inventory records show the following data:
$\begin{array}{lrr}\text { Units }&\text { Unit Cost }\\\text { Inventory, January } 1 & 5,000 & £ 4.50 \\\text { Purchases: June 18 } & 4,500 & 4.00 \\\text { November } 8 & 3,000 & 3.50\end{array}$

A physical inventory on December 31 shows 2,000 units on hand.Holliday sells the units for ?6 each.The company has an effective tax rate of 20%.Holliday uses the periodic inventory method. Under the FIFO method, the December 31 inventory is valued at

• A)?7,000.
• B)?7,250.
• C)?7,500.
• D)?9,000.

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Definitions:

Coccyx

The small, triangular bone at the base of the spinal column, commonly referred to as the tailbone, which can be a source of pain if injured.

Serosanguineous

Pertaining to a fluid that is a mixture of serum and blood, typically seen in wounds as a type of discharge.

Watery Drainage

Fluid that is thin and clear, resembling water, which may leak from a wound, sore, or infection site.

Red

A color at the end of the visible spectrum, often associated with danger, passion, or excitement.