Year-End Entries to Update Inventory Accounts
Omaha Corporation Uses FIFO

question 16

Essay

Year-end entries to update inventory accounts
Omaha Corporation uses FIFO and a periodic inventory system. You have been provided with the following information relating to the company's inventory for the year ended December 2020:
$\begin{array}{llcc} \text { Beginning inventory Jan 1 } & \$24,500\\ \text { Ending inventory Dec 31 } &109,800\\ \text { Total purchases recorded during 2020} &130,000\\\end{array}$
Instructions
Record the journal entry (entries) that are required to bring Omaha's inventory accounts and cost of goods sold up to date for 2020.

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Definitions:

Liable for Payment

Being legally responsible for the settlement of a debt or financial obligation, typically as a consequence of a contract or law.

Consent

The voluntary agreement to or approval of what is done or proposed by another; can be given explicitly or implicitly.

Assign a Mortgage

The transfer of a mortgage from one party to another, changing the lender or creditor while the borrower remains the same.

Partial Discharges

The release or forgiveness of a portion of a debt or obligation, without fully extinguishing the entire obligation.