# Beacon food stores purchased canned goods at an

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Beacon Food Stores purchased canned goods at an invoice price of \$3,000 and terms of 2/10, n/60. Half of the goods had been mislabeled and were returned immediately to the supplier. If Beacon Food pays the remaining amount of the invoice within the discount period, the amount paid should be: \$1,470. At the beginning of 2015, Midway Hardware has an inventory of \$340,000. Because sales growth was strong during 2015, the owner wants to increase inventory on hand to \$370,000 at December 31, 2015. If net sales for 2015 are expected to be \$2,120,000, and the gross profit rate is expected to be 30%, compute the cost of the merchandise the owner should expect to purchase during 2015. \$1,514,000. Venus Wholesale Co. started carrying a new product in December. Purchases and sales of this product during the month were: Dec. 20 Purchased 180 units at \$88 per unit. Dec. 26 Sold 170 units. Dec. 28 Purchased 180 units at \$96 per unit. Assuming the LIFO flow assumption is in use, the perpetual inventory records will indicate an ending inventory of this product of: \$18,160. (10 × \$88) + (180 × \$96) = \$18,160 At year-end, Venus restates the carrying value of its inventory using periodic LIFO costing procedures.
Under periodic costing procedures, the LIFO cost of the inventory is: \$16,800. QUIZ 8 Which of the following should not be treated as a revenue expenditure? Delivery costs on newly purchased equipment. Expenditures for research and development intended to lead to new products of commercial value: Should be charged to expense when incurred. Mayer Instrumentation sold a depreciable asset for cash of \$300,000. The original cost of the asset was \$1,200,000. Mayer recognized a gain of \$45,000 on the sale. What was the amount of accumulated depreciation on the asset at the time of its sale? \$945,000. When comparing the units-of-output method of depreciation with straight-line depreciation: The depreciation expense in the first year may be greater than, equal to, or less under the units-of-output method.
The gain or loss on the disposal of a depreciable asset reported in financial statements often differs from that reported for income tax purposes. The principal reason for the difference is: Different depreciation methods have been used in financial statements and in income tax returns. On March 2, 2014, Glen Industries purchased a fleet of automobiles at a cost of \$550,000. The cars are to be depreciated by the straight-line method over five years with no salvage value. Glen uses the half-year convention to compute depreciation for fractional periods. The book value of the fleet of automobiles at December 31, 2015, will be: \$385,000. Wilbur Company purchased \$10,000 of equipment on January 20, 2014. Wilbur uses the straight-line method to depreciate the equipment. The equipment has a 5-year useful life with no salvage value. Which of the following statements is correct? Wilbur will record no cash flows related to this asset on its 2015 statement of cash flows.