Question

A review of the general ledger of Silicon R Us, Inc. provides the following

data for the FYE 12-31-2019

Sales Revenue

$4,276,000

Inventory at 12-31-2018

$1,425,975

Purchases in 2019

$1,935,200

Silicon R Us, Inc. employs a pricing model that yields 27.5% gross profit on sales.

Required:

A. Calculate and write in the following information:

1

Write in the Cost of Goods Available for Sale (COGAFS):

$_____________________

2

Write in your expectation of Cost of Goods Sold (COGS):

$_____________________

3

Write in your expectation of Gross Profit (GP):

$_____________________

4

Write in your expectation of Ending Inventory:

$_____________________

Use this space for your calculations:

B.

If a physical count of Ending Inventory revealed inventory on hand at December 31, 2019

actually $150,350 select the best reason as to why?

     A) Some inventory was lost or stolen

     B) Sales were understated for the period

     C) Accounts Payable are understated

     D) Accounts Payable are overstated

     E) Accounts Receivable are understated

     F) Accounts Receivable are overstated