Storme Shutters Has the Following Inventory Information A Physical Count of Merchandise Inventory on November 30 Reveals

question 53

Multiple Choice

Storme Shutters has the following inventory information. $\begin{array}{rrr}\text { Nov. }&1 & \text { Inventory } & 30 \text { units } @ \$ 8.00 \\&8 & \text { Purchase } & 120 \text { units } \$ 8.30 \\&17 & \text { Purchase } & 60 \text { units } \$ 8 .40 \\&25 & \text { Purchase } & 90 \text { units } \$ 8.80\end{array}$ A physical count of merchandise inventory on November 30 reveals that there are 80 units on hand. Assuming that the specific identification method is used and that ending inventory consists of 20 units from each of the three purchases and 20 units from the November 1 inventory, cost of goods sold is

• A) $1,758.
• B) $1,870.
• C) $1,862.
• D) $1,812.

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Definitions:

Straight-line Depreciation Rate

The straight-line depreciation rate is a method of calculating the depreciation of an asset, where its cost is evenly spread over its useful life, resulting in a fixed annual depreciation expense.

Salvage Value

The estimated value that an asset will realize upon its sale at the end of its useful life.

Total Asset Cost

The sum of all costs incurred to acquire an asset and make it ready for its intended use.

Depreciation Expense

Depreciation expense is the allocation of the cost of a tangible asset over its service life, reflecting the decrease in its value over time.