A Company Uses the Periodic Inventory System and the Following

question 104

Essay

A company uses the periodic inventory system and the following information is available.All purchases and sales are on credit.

1.)Prepare the general journal entries to record:
The October 6 purchase.
The October 12 sale.
2.)Assuming the periodic inventory system is used,determine both the cost of the ending inventory and the cost of goods sold using the LIFO method for October.

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Definitions:

Promissory Estoppel

A legal principle that prevents a party from withdrawing a promise made to another party if the latter has relied on that promise to their detriment.

Stock Option

A financial instrument granting the holder the right, but not the obligation, to buy or sell a stock at an agreed-upon price within a certain period.

Detrimental Reliance

A legal principle where a party suffers harm by relying on a misleading statement or promise of another.

Bargained-for Exchange

A fundamental principle of contract law that involves a mutual exchange of value or promises between parties.