Winedark Sea Ltd sells prints of classic paintings. The prints are done on expensive paper and are quite costly. Pricing the prints to sell is hard because the popularity of a print is difficult to predict. Sometimes prints don't sell well at all and are then disposed of in bulk for use in hotels and motels.

Here are data on two prints:

1. Calculate the following:

a. Inventory cost, 31 December 2016, for Print X, FIFO basis

b. COGS, 2016, for Print Y, AVGE basis

2. Print Y hasn't sold since September. No one seems to like it any more. An out-of-town hotel has offered $100 for each Print Y that Winedark has left, if Winedark will pay the $10 per print shipping cost. What amount would you suggest be used for the inventory of Print Y on the 31 December 2016 balance sheet? Why?

Transcribed Image Text:

Inventory, 1 January 2016 Purchases during 2016: January-June July-December Sales during 2016 Print X Units Cost per unit $ 340 4 10 15 23 350 330 Print Y Units Cost per unit $ 500 11 25 30 38 480 510