Baldwin Company Had the Following Balances and Transactions During 2019

question 155

Multiple Choice

Baldwin Company had the following balances and transactions during 2019: $$\begin{array} { | l | l | } \hline \text { Beginning Merchandise Inventory as of } & \\\text { January } 1,2019 & 125 \text { units at } \$ 82 \\\hline \text { March 10 } & \text { Sold } 80 \text { units } \\\hline \text { June } 10 & \text { Purchased } 250 \text { units at } \$ 86 \\\hline \text { October 30 } & \text { Sold 205 units } \\\hline\end{array}$$ What would be reported as Cost of Goods Sold on the income statement for the year ending December 31,2019 if the perpetual inventory system and the first-in,first-out inventory costing method are used?

• A) $10,250
• B) $17,450
• C) $31,750
• D) $24,010

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Definitions:

Debt-to-Equity Ratio

A measure of a company's financial leverage, calculated by dividing its total liabilities by stockholders' equity.

Year 2

Typically refers to the second year in a designated time frame, often used in financial and performance analysis.

Times Interest Earned Ratio

A financial metric that measures a company’s ability to meet its interest obligations based on its current earnings before interest and taxes.

Equity Multiplier

A financial leverage ratio that measures the portion of a company’s assets that are financed by its shareholders' equity.