Torrington Inc

question 126

Essay

Torrington Inc.updates its inventory records perpetually.The company's records showed a beginning inventory of $6,200,cost of goods sold of $81,600,and ending inventory of $12,000.
Required:
Determine the amount of inventory that was purchased during the year.

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Definitions:

Fair Value

The estimated market price of an asset or liability, reflecting the amount for which it could be exchanged in an orderly transaction between knowledgeable, willing parties.

Trading Investment

Investments in financial instruments held for the purpose of selling them in the short term for a profit.

Realized Gain

It refers to the profit made from the sale of an asset or investment, which has been completed and is no longer just a theoretical or paper value.

Credit

An accounting entry that increases liabilities and shareholders' equity or decreases assets.