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Problem 16-60 ( LO . 6 ) Grouse Company is a furniture retailer whose average annual gross receipts for the three preceding years exceeded $
Problem 16-60 ( LO . 6 ) Grouse Company is a furniture retailer whose average annual gross receipts for the three preceding years exceeded $ 26,000,000 . In the current tax year , the company purchased merchandise with an invoice price of $ 15,000,000 , less a 2 % discount for early payment . However , the company had to borrow on a bank line of credit and paid $ 150,000 interest to take advantage of the discount for early payment . Freight on the merchandise purchased totaled $ 360,000 . For September , Grouse agreed to pay the customer's freight on goods sold . The total cost of this freight - out was $ 70,000 . The company has three stores and operates a warehouse where it stores goods . The cost of operating the warehouse was $ 240,000 . The $ 240,000 includes labor , depreciation , taxes , and insurance on the building . The cost of the purchasing operations totaled $ 420,000 . The jurisdiction where the company operates imposes a tax on inventories on hand as of January 1. The inventory tax for this year is $ 24,000 . The invoice cost of goods on hand at the end of the year is $ 3,000,000 a . Grouse's total cost of goods purchased is b . Grouse's total cost of ending inventory using the FIFO method is $
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