Fargo Engines Incorporated Sells Part Number 45G to Toy Manufacturers

question 161

Multiple Choice

Fargo Engines Incorporated sells part number 45G to toy manufacturers around the world.Information about part number 45G is contained in the table below.Fargo uses a LIFO periodic inventory system. Determine the cost of goods sold and ending inventory cost of part 45G,if 2,000 units remain unsold in inventory at the end of the accounting period.

• A)Cost of goods sold is $67,600 and ending inventory is $16,000.
• B)Cost of goods sold is $66,600 and ending inventory is $17,000.
• C)Cost of goods sold is $66,200 and ending inventory is $17,400.
• D)Cost of goods sold is $8,000 and ending inventory is $2,000.

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Definitions:

Canada Plus Call

Call provision that compensates bond investors for interest differential, making it unattractive for an issuer to call a bond.

Face Value

The nominal value stated on a financial instrument, such as a bond or stock certificate, representing its official worth.

Par Value

The nominal value or face value given to a security or bond by the issuer.

Default Risk Premium

The additional amount a borrower must pay to compensate the lender for assuming the risk that the borrower may default on the loan.