Problem # 2 Closing Entries

Presented below is income statement information of the Schefter Corporation for the year ended December 31, 2022.

Sales revenue $502,000

Cost of goods sold 287,000

Salaries expense 70,000

Insurance expense 11,000

Interest revenue 5,000

Interest expense 6,500

Advertising expense 8,500

Income tax expense 24,000

Gain on sale of investments 8,600

Depreciation expense 23,000

Drawing 4,000

Required:

Prepare the necessary closing entries in December 31, 2022.

Problem #3 Periodic Inventory Valuation

Elsas Boards sells a snowboard, Xpert, that is popular with snowboard enthusiasts. Information relating to Elsas purchases of Xpert snowboards during September is shown below. During the same month, 111 Xpert snowboards were sold. Elsas uses a periodic inventory system. Date

Explanation Units Unit Cost Total Cost

Sept. 1 Inventory 36 $ 95 ???

Sept. 12 Purchases 45 101 ???

Sept. 19 Purchases 20 103 ???

Sept. 26 Purchases 60 108 ???

Totals ??? ???

Instructions

(a) Compute the ending inventory at September 30 and cost of goods sold using the FIFO, LIFO, and Average Cost Method. Prove the amount allocated to the cost of goods sold under each method.

(b) For both FIFO, LIFO, and Average Cost Method, calculate the sum of ending inventory and cost of goods sold.

(c ) What do you notice about the answers you found for each method?