problem $1$:

Racers ATVs sells many makes and models of all terrain vehicles. Racers uses a periodic inventory system. On January $1,$ Racers had a beginning inventory of AXVs costing $$28,600.$ On January $14,$ Racers received a shipment of Model AXVs with a purchase price of $$14,700$ and transportation costs of $$400.$ On May $19,$ Racers received a second shipment of AXVs with a purchase price of $$16,900$ and transportation costs of $$450.$ On November $1,$ Racers received its before$-$Christmas shipment of AXVs with a purchase price of $$27,800$ and transportation costs of $$750.$

Make the necessary journal entries for January $14,$ May $19,$ and November $1$ to show the purchase of the inventory.

Assume that a physical inventory count on December $31$ showed an ending inventory of AXVs of $$25,800.$ Determine cost of goods sold for the AXV model for the year.

If sales of AXVs were $$96,700,$ what profit did Racers make on this model?

Problem $2$:

Magic Carpets Inc. sells a full line of area rugs, from top quality to bargain basement. Economic conditions have hit the textile industry, and Magic Carpets accountant is concerned that its rug inventory may not worth the amount Magic paid for it$.$ Information about three lines of rugs is found below:

Cost Sales Price Cost to Sell Number of rugs in inventory

High Flyers $$235$ $$250$ $$2580$

Midflight $15022025120$

Under the Radar $10010922160$

Determine market value for each type of rug.

Determine lower$-$of$-$cost$-$or$-$market for each type of rug.

Determine if Magic Carpets has suffered a loss of value on its inventory, and if so$,$ what the amount of loss is$.$

Show the journal entry to record the loss if there is one.