The following lots of a particular commodity were available for sale during the year Beginning inventory First purchase Second purchase Third purchase s units at $61 15 units at $63 10 units at $74 10 units at $7 The firm uses the periodic system and there are 20 units of the commodity on hand at the end of the year 35. What is the amount of cost of goods sold for the year according to the FIFO method? a. $1,380 b. $1,375 c. $1,250 d. $1,510 36. On June 1, 2014, Aaron Company purchased equipment at a cost of $120,000 that has a depreciable cost of $90,000 and an estimated useful life of 3 years and 30,000 hours Using straight-line depreciation, calculate depreciation expense for the last year a. $30,000 b. $40,000 c. $17,500 d. $12,500 37. How does paying a liability in cash affect the accounting equation? a. Assets decrease; liabilities decrease b. Assets increase; liabilities decrease c. Assets increase; liabilities increase d. Liabilities decrease; stockholders equity increase 38. When merchandise is returned under the perpetual inventory system, the buyer would credit a. Accounts Receivable b. Merchandise Inventory c. Accounts Payable d. Purchases Returns and Allowances