Class Exercise 8
S6 – 14: Magic Carpets began the year with inventory of $1,400,000. Inventory purchases for the year
totaled $3,200,000. Sales revenue for the year was $7,000,000, and the gross margin was 45 percent.
How much is Magic Carpets’ estimated cost of ending inventory? Use the gross margin method.
E6 – 11
Compute ending inventory and cost of goods sold using each of the following methods, assuming a
periodic inventory system is used:
Specific-unit cost, assuming three $170 units and three $180 units are on hand on November 30,