The following selected information is presented for Pronghorn Limited for the year ended February 28, 2024. Pronghorn uses a periodic inventory system. Accounts receivable Administrative expenses Common shares Deferred revenue Dividends declared Freight in Income tax expense Interest expense $35,100 Inventory, Mar. 1, 2023 130,600 Inventory, Feb. 28, 2024 Purchase discounts 4,860 Purchase returns and allowances 91,800 45,360 9,140 10,100 8,480 Purchases Sales Selling expenses $59,080 85,840 42,120 22,520 294,840 424,680 9,800

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…