Use the Chart Provided Below to Determine the Impact of a Company

question 23

Essay

Use the chart provided below to determine the impact of a company expensing $4,000 transportation costs related to the purchase of its inventory. At year end, the company had sold 50% of the affected inventory items.
$$\begin{array} { | l | l | l | } \hline \text { Goods included in inventory count } & \\\hline \text { Purchases recorded during the year } &\\\hline \text { Transportation costs included in inventory }&\\\hline & 2020 & 2021 \\\hline \text { Beginning inventory } & & \\\hline + \text { Purchases } & & \\\hline \text { -Ending inventory } & & \\\hline \text { =Cost of goods sold } & & \\\hline & & \\\hline \text {Operating expense } &\text{NA} &\text{NA} \\\hline \text { Net income } & --- &---\\\hline & & \\\hline \text { Assets } & & \\\hline \text { Liabilities } & & \\\hline \text { Equity } & &\\\hline\end{array}$$

---

Definitions:

Bonus Pay

A plan that provides one-time payments based on performance accomplishments.

Lump-sum Payment

A one-time payment for the total amount owed, as opposed to payments divided into installments.

Performance Targets

Specific goals set by organizations or individuals aiming to achieve a defined level of performance over a given period.

Canada Pension Plan

A federal social insurance program in Canada providing retirement, disability, and survivor benefits to eligible individuals.