Dakota Industries Has Two Items in Inventory as of December

question 33

Multiple Choice

Dakota Industries has two items in inventory as of December 31, 2010. Each item was purchased for $52. Company management chose to write down Item #1 to $39, which at year-end was assessed to be its market value. Management did not write down Item #2 because its market value was estimated to be greater than $52. During 2010, each item was sold for $63 cash. If Dakota uses the perpetual inventory method, which of the following would be included in the entry or entries to record the sale of Item #1?

• A) A debit to Sales for $63.
• B) A credit to Inventory for $52.
• C) A debit to Cost of Goods Sold for $39.
• D) A credit to Cost of Goods Sold for $52.

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Definitions:

Developmental Psychopathology

The study of the growth and development of psychological disorders, with a focus on both normal and abnormal developmental processes.

Generalized Anxiety Disorder

A chronic condition characterized by excessive and persistent worrying about various aspects of life, often without a specific cause.

Body Dysmorphic Disorder

A mental disorder involving obsessive focus on a perceived flaw in appearance, often leading to significant distress and impaired functioning.

Agoraphobia

An anxiety disorder characterized by an intense fear of being in places where escape might be difficult or help might not be available, often leading to avoidance behaviors.