1. The initial data on inventory, purchases and sales of tennis rackets are as follows:

April	3		Inventory	21 units	@	$17
	11		Purchase	12 units	@	$17
	14		Sale	16 units
	21		Purchase	14 units	@	$19
	25		Sale	17 units

Complete the inventory cost card assuming the company maintains a perpetual inventory system and determine cost of goods sold and ending inventory using LIFO.

	shopping				Cost of Goods Sold				Inventory
Date	Cant.	Unit cost	Total cost		Cant.	Unit cost	Total cost		Cant.	Unit cost	Total cost
April 3										ps	ps
11		ps	ps							ps	ps
										ps
14						ps	ps			ps	ps
						ps
21		ps	ps							ps	ps
										ps
25						ps	ps			ps	ps
						ps
					Total cost of goods sold		ps		ending inventory value		ps

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2. Journalize the following transactions using the write-off method of accounting for uncollectible accounts receivable.

April 1st	Sold merchandise on account of Jim Dobbs, $6,900. The cost of goods sold is $4,600.
June 10th	Received payment of one-third of the account receivable from Jim Dobbs and paid off the remainder.
October 11th	He reinstated Jim Dobbs' account and received cash in full payment.

If a quantity box does not require an entry, leave it blank.

April 1st
April 1st
June 10th
October 11th
October 11th

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3.The equipment was purchased at the beginning of the year at a cost of $78,660. The equipment was depreciated using the straight-line method based on an estimated useful life of 6 years and an estimated residual value of $7,920.

Required:

a.	What was the depreciation expense for the first year?
b.	Assuming that the equipment was sold at the end of the second year for $59,486, determine the gain or loss on the sale of the equipment.
C.	Journalize the entry to record the sale. Please refer to the Chart of Accounts for the exact wording of account titles.

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