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Management 200 – Introductory Financial Accounting– Spring 2010
Krannert School of Management - Purdue University
Homework 4 – due Wednesday, March 10, 2010 - SOLUTION
This homework must be turned in on this sheet of pages (please staple). It is preferred that
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grade for this assignment will be based on the correctness of a partial portion of the assignment – the full
assignment will not be graded. Please print your name and PUID clearly and legibly in the spaces above.
PART A: Mac Imports was formed in 2006 to sell a single product, the Pastroni, which is
imported from Italy.
The price of this product was a constant $14 per unit during 2006
and 2007, but due to unfavorable exchange rates the cost of this product more than
doubled during 2008 and 2009.
Sales for 2009 (2008) totaled 124,000 units for a total of
$4,960,000 (107,000 units for a total of $3,745,000).
Mac uses a periodic inventory
system and provides the following information about cost of goods purchased during the
last two years:
Opening Inventory (12/31/07)
19,000 units @ $14.00
Purchase, May 13, 2008
57,000 units @ $17.00
Purchase, September 28, 2008
64,000 units @ $21.00