(SOLVED) Suppose Trendy Now Fashions a specialty retailer had these rec


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$19

Suppose Trendy Now Fashions, a specialty retailer, had these records for ladies evening gowns during 2010.Beginning inventory (40 @ $1,075)……………….. $ 43,000Purchase in February (22 @ $1,200)……………… 26,400Purchase in June (53 @ $1,275) ……………………. 67,575Purchase in December (26 @ $1,325)…………….. 34,450Goods available for sale ………………………………. $171,425Assume sales of evening gowns totaled 130 units during 2010 and that Trendy Now uses the LIFO method to account for inventory. The income tax rate is 40%.Requirements1. Compute Trendy Now’s cost of goods sold for evening gowns in 2010.2. Compute what cost of goods sold would have been if Trendy Now had purchased enough inventory in December at $1,325 per evening gown to keep year-end inventory at the same level it was at the beginning of the year.

Answer

$19