Landis Company Is Preparing Its Financial Statements

question 81

Multiple Choice

Landis Company is preparing its financial statements. Gross margin is normally 40% of sales. Information taken from the company's records revealed sales of $75,000; beginning inventory of $7,500 and purchases of $52,500. What is the estimated amount of ending inventory at the end of the period?

• A)$15,000
• B)$45,000
• C)$30,000
• D)$24,000

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Definitions:

Document Of Title

A legal document representing ownership of goods and providing the right to transfer that ownership.

Bailee

A bailee is a person or entity that temporarily holds property or goods belonging to another, under a bailment agreement, with the duty to return them in good condition.

Transfer Control

The process of changing the ownership or authority over a particular entity or asset from one party to another.

Delivery

The process of transporting goods from one location to another or the act of transferring possession and ownership of an asset or property.