1. Explain the meaning of "cost" and "market" as used in the application of the lower-of- cost-or-market rule with an example, 2. Write three examples each, for asset use and asset exchange transactions. 3. The details of inventory on Jan. 1, 2019 and its subsequent purchase are given below. Date No. of Units Jan. 1 100 Unit Price $20 $25 $30 Jan 10 Beginning balance Purchase Purchase Purchase 200 Total Cost $2,000 $5,000 $3,000 $8,000 Jan 15 Jan 30 100 200 $40 On February 1, 2019, the company sold 500 units at $40 cach. Calculate the cost of goods sold using the First-In-First Out Method and the Gross Margin. 4. Indicate how each of the following accounting events affects the elements of a financial statement, using horizontal financial statement. a. Lazarus Co. purchased $20,000 of merchandise inventory on account from a supplier, HTP Company b. Lazarus Co. paid $800 cash to a freight company for delivering inventory that Lazarus had purchased from HTP Company with freight terms FOB shipping point. c. A customer returned goods to Lazarus Co. that had been purchased for $500 on account. The goods had originally cost Lazarus $350. 5. McGraw Hill had $5,000 of inventory at the beginning of 2019. During the year, the company bought $55,000 in inventory. The company paid $400 transportation expense as the inventory was purchased FOB shipping point. During the year, the company returned $2000 of inventory to the supplier. The supplier gave $1,200 as cash discount for payment within the discount period. At the end of the year, the ending inventory worth $8,000 Calculate the cost of goods sold