Delaware Retail Company Had the Following Balances and Transactions During

question 38

Multiple Choice

Delaware Retail Company had the following balances and transactions during 2019. $$\begin{array} { | l | l | } \hline \text { Beginning Inventory } & \text { 20 units at } \$ 70 \\\hline \text { Tune } 10 & \text { Purchased } 40 \text { units at } \$ 83 \\\hline \text { December 30 } & \text { Sold 30 units } \\\hline \text { December 31 } & \text { Replacement cost } \$ 60 \\\hline\end{array}$$ The company maintains its records of inventory on a perpetual basis using the last-in,first-out inventory costing method.Calculate the amount of ending Merchandise Inventory at December 31,2019 using the lower-of-cost-or-market rule.

• A) $2,490
• B) $2,400
• C) $1,800
• D) $3,600

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Definitions:

Elastic Firm Demand

Describes a situation where the demand for a firm's products is highly sensitive to changes in price, indicating consumers are likely to change their purchasing behavior if the price changes.

Significant Barriers

Obstacles that significantly hinder entry into a market or industry, including legal restrictions, high start-up costs, and substantial economic and technological challenges.

Oligopolistic Firm

A company that operates in a market structure characterized by a small number of firms that have significant market control, leading to limited competition.

Pricing Decisions

The process of determining what price to charge for a product or service, considering costs, market demand, and competition.