Reference no: EM132631370

Problem 1: The Wilson Company purchased $40,000 of merchandise from the Poole Wholesale Company. Wilson also paid $3300 for freight costs to have the goods shipped to its location. Which of the following statements regarding the necessary entries for the transactions is true? Wilson uses the perpetual inventory system.

Select one:

A. Total increases to the inventory account would be $40,000.

B. Total increases to the inventory account would be $3300.

C. Transportation-in would be increased by $3300.

D. Total increases to the inventory account would be $43,300.

Problem 2: Alvarado Company began the current month with inventory costing $19,000, then purchased inventory at a cost of $52,950. The perpetual inventory system indicates that inventory costing $57,128 was sold during the month for $56,850. If an inventory count shows that inventory costing $13,500 is actually on hand at month-end, what amount of shrinkage occurred during the month?

Select one:

A. $13,495

B. $1322

C. $14,822

D. $3900