Required information [The following information applies to the questions displayed below.] Trey Monson starts a merchandising business on December 1 and enters into the following three inventory purchases. Monson uses a perpetual inventory system. Also, on December 15, Monson sells 15 units for $35 each. Purchases on December 7 Purchases on December 14 Purchases on December 21 Of the units sold, 8 are from the December 7 purchase and 7 are from the December 14 purchase. Determine the costs assigned to ending inventory when costs are assigned based on specific identification. Purchases: December 7 December 14 December 21 Total 10 units $21.00 cont 20 units $27.00 cost 15 units @ $29.00 cost # of units Goods Available for Sale 0 Cost per unit Specific Identification Cost of Goods Available for Sale $ $ 0 0 0 0 Cost of Goods Sold # of units sold 0 Cost Cost of per unit Goods Sold $0.00 $ 0.00 $ 0 0 0 Ending Inventory of units Cost per Ending in ending inventory unit Inventory 0 $0.00 $ 0.00 0.00 $ 0 0 0 0

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in…