LO $5-1$

Problem $5-20$A Allocating product costs between cost of goods sold and ending inventory: intermittent purchases and sales of merchandise

Ycel

CHECK FIGURES

a$.$ Cost of Goods Sold: $$49,250$

c$.$ Ending Inventory: $$17,550$

Pam's Creations had the following sales and purchase transactions during Year $2.$ Beginning inventory consisted of $60$ items at $$350$ each. The company uses the FIFO cost flow assumption and keeps perpetual inventory records.

$\backslash$table$[[$Date$,$Transaction,Description$],[$Mar$.5,$Purchased,$50$ items @ $$370],[$Apr$.10,$Sold,$30$ items @ $$450],[$June $19,$Sold,$60$ items @ $$450],[$Sep$.16,$Purchased,$70$ items @ $$390],[$Nov$.28,$Sold,$45$ items @ $$480]]$

Required

Page $265$

a$.$ Record the inventory transactions in a financial statements model.

b$.$ Calculate the gross margin Pam's Creations would report on the Year $2$ income statement.

c$.$ Determine the ending inventory balance Pam's Creations would report on the December $31,$ Year $2,$ balance sheet.