Valuing Inventory and Recording Entries Using Relative Sales Value Method AVC Inc. purchased 2,280 bags of pecans that cost $7,980. The company also incurred $570 for transportation and grading. The pecans graded out as follows. Grade Quantity (bags) Current Market Price per Bag 760 $6.75 1,140 6.00 190 4.50 Waste 190 1 B U Required Assume the relative sales value method is used to allocate lump sum costs. Carry all decimals in calculations; round the final answer to the nearest dollar. a. Prepare the purchase entry assuming a perpetual inventory system. b. Determine the value of ending inventory assuming the following quantities are in inventory: grade A, 190 bags: grade B, 152 bags; and grade C. 76 bags. C. Prepare the entry for sale of 38 bags of grade A pecans at a market price of $6.75 cash per bag. Account Name a. Inventory-Grade A 3,420 Inventory-Grade B Inventory-Gradec 570 Accounts Receivable 8,550 b. Inventory-Grade A $ Inventory-Grade B Inventory-Gradec Total $ 1,691 Dr. 4,560 0 . X 0 855 608 228 Account Name Dr. Cr. 171 X 0 0X 256.5 X C. Cash Cost of Goods Sold Sales Inventory 256.5 X 171 Computing Gross Profit and Cost Percentages Given Ending Inventory Balances Harris Inc. with a December 31 year-end, applies a periodic inventory system in reporting inventory. Because its physical inventory count take place at year-end, Harris estimates ending inventory for its quarterly reports using the gross profit method. The following information for the first two quarters of 2020 is available for Harris. Inventory, December 31, 2019 (based on physical count) $36,000 Inventory, March 31, 2020 (estimated) 15,000 Inventory, June 30, 2020 (estimated) 47,200 Purchases, First quarter, 2020 100,000 Purchases, Second quarter, 2020 140,000 Net sales, First quarter, 2020 160,000 Net sales, Second quarter, 2020 144,000 Compute the following percentages, rounding answers to the nearest full percentage point; for example, enter 60 for 60.4% or 61 for 60.5%. a. Estimate markup on sales for first quarter 2020. 75.696 x b. Estimate markup on cost for first quarter 2020. 79.396 x c. Estimate markup on sales for second quarter 2020. 096 x d. Estimate markup on cost for second quarter 2020. 096 X