AVC Inc. purchased 1,920 bags of pecans that cost $6,720. The company also incurred $480 for...

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AVC Inc. purchased 1,920 bags of pecans that cost $6,720. The company also incurred $480 for transportation and grading. The relative sales value method is used to allocate the lump sum cost. The pecans graded out as follows. Grade Quantity (bags) Current Market Price per Bag A 640 $6.75 B 960 6.00 C 160 4.50 Waste 160 0.00 Required a. Prepare the purchase entry assuming a perpetual inventory system. b. Determine the value of ending inventory assuming the following quantities are in inventory at year-end: grade A, 160 bags; grade B, 128 bags; and grade C, 64 bags. c. Prepare the entry for sale of 32 bags of grade A pecans at a market price of $6.75 cash per bag. AVC Inc. purchased 1,920 bags of pecans that cost $6,720. The company also incurred $480 for transportation and grading. The relative sales value method is used to allocate the lump sum cost. The pecans graded out as follows. Grade Quantity (bags) Current Market Price per Bag A 640 $6.75 B 960 6.00 C 160 4.50 Waste 160 0.00 Required a. Prepare the purchase entry assuming a perpetual inventory system. b. Determine the value of ending inventory assuming the following quantities are in inventory at year-end: grade A, 160 bags; grade B, 128 bags; and grade C, 64 bags. c. Prepare the entry for sale of 32 bags of grade A pecans at a market price of $6.75 cash per bag.

Answer rating: 100% (QA)

a Purchase Entry assuming perpetual inventory system Inventory Grade A ... View the full answer