Forge Company, a calendar-year entity, had 6,000 units in its beginning inventory for 20X8. On December 31, 20X7, the units had been adjusted down to $470 per unit from an actual cost of $510 per unit. It was the lower of cost or market. No additional units were purchased during 20X8. The following additional information is provided for 20X8: Forge does not have sufficient experience with the seasonal market for its inventory units and assumes that any reductions in market value during the year will be permanent.
Based on the preceding information, the cost of goods sold for the second quarter is:
A) $416,000
B) $364,000
C) $304,000
D) $424,000

Question

Forge Company, a calendar-year entity, had 6,000 units in its beginning inventory for 20X8. On December 31, 20X7, the units had been adjusted down to $470 per unit from an actual cost of $510 per unit. It was the lower of cost or market. No additional units were purchased during 20X8. The following additional information is provided for 20X8:  Forge does not have sufficient experience with the seasonal market for its inventory units and assumes that any reductions in market value during the year will be permanent.
Based on the preceding information, the cost of goods sold for the second quarter is:
A) $416,000 
B) $364,000 
C) $304,000 
D) $424,000

Quizplus · Accepted Answer

The Answer of Forge Company, a calendar-year entity, had 6,000 units in its beginning inventory for 20X8. On December 31, 20X7, the units had been adjusted down to $470 per unit from an actual cost of $510 per unit. It was the lower of cost or market. No additional units were purchased during 20X8. The following additional information is provided for 20X8:  Forge does not have sufficient experience with the seasonal market for its inventory units and assumes that any reductions in market value during the year will be permanent.
Based on the preceding information, the cost of goods sold for the second quarter is:
A) $416,000 
B) $364,000 
C) $304,000 
D) $424,000

Forge Company, a Calendar-Year Entity, Had 6,000 Units in Its