The Gift Horse began 2021 with 60,000 units of inventory that cost $36,000. During 2021, The Gift Horse purchased merchandise on account for $352,500: Click the icon to view the purchases.) Cash payments on account totaled $326,000 during the year (ignore purchase discounts). The Gift Horse's sales during 2021 consisted of 520,000 units of inventory for $660,000, all on account. The company uses the FIFO inventory method. Cash collections from customers were $630,000. Operating expenses totaled $240,500, of which The Gift Horse paid $211,000 in cash. The Gift Horse credited Accrued Liabilities for the remainder. At December 31, The Gift Horse accrued income tax expense at the rate of 35% of income before tax. Read the requirements. a. Use a T-account. (Abbreviation used: COGS = cost of goods sold.) Inventory Beg bal Purchases 36,000 352,500 COGS End bal 49,000 339,500 b. Multiply the number of units on hand by the unit cost. Number of units in ending inventory Unit cost of ending inventory at FIFO FIFO cost of ending inventory 580000 .64 375500