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During 2018, a company sells 200 units of inventory for $50 each. The company has the...

During 2018, a company sells 200 units of inventory for $50 each. The company has the following inventory purchase transactions for 2018: Date Transaction Number of Units Unit Cost Total Cost Jan. 1 Beginning inventory 50 $ 39 $ 1,950 May. 5 Purchase 100 38 3,800 Nov. 3 Purchase 80 37 2,960 230 $ 8,710 Actual sales by the company include its entire beginning inventory, 80 units of inventory from the May 5 purchase, and 70 units from the November 3 purchase. Calculate cost of goods sold and ending inventory for 2018 assuming the company uses specific identification.

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Answer #1
Calculation of Cost of Goods Available for Sale
Date Units Unit Cost Total Cost
January 1 50 39 1950
May 5 100 38 3,800
November 3 80 37 2,960
Total 230 $8,710

Cost of goods available for sale = $8,710

Calculation of Cost of Goods Sold
Date Units Unit Cost Total Cost
January 1 50 39 1950
May 5 80 38 3,040
November 3 70 37 2,590
Total 200 $7,580

Cost of goods sold = $7,580

Cost of ending inventory = Cost of goods available for sale - Cost of good sold

= 8,710-7,580

= $1,130

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