When inventory is purchased it, is recorded as a (n) and when sold it becomes a(n)
a. liability, withdrawal
b. assets expense
c. liability, asset
d. assets contra-asset
Use the following information to answer the questions 2 through 5.
Inventory data for Newman & Frith Merchandisers Inc. is provided here. Sales for the period were 2,800 units. Each sold for $8. The company maintains a periodic inventory system.
|
Date |
Beginning inventory |
Number of Units |
Cost of Units |
Total Cost |
|
January |
Purchase |
1,000 |
$3.00 |
$ 3,000 |
|
February |
Purchase |
600 |
$3.50 |
$ 2,100 |
|
March |
Purchase |
800 |
$4.00 |
$ 3,200 |
|
April |
Purchase |
1200 |
$4.25 |
$5,100 |
|
Totals |
Purchase |
3600 |
$13,400 |