The Sarver Farm Has Completed the Fall Harvest with 50,000

question 23

Multiple Choice

The Sarver Farm has completed the fall harvest with 50,000 bushels of premium wheat. The wheat cost $75,000 from planting to harvest and the market price of the wheat on the day it is placed in the silo is $2.50 per bushel. Sarver sells 42,000 bushels in Year 1 and holds the remaining 8,000 until Year 2 when it sells for $3.00 per bushel.
-Using the completed transaction (sales) method,how much net income should Sarver recognize in Year 1?

• A)$42,000
• B)$50,000
• C)$105,000
• D)$125,000

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