calculate the inventory depreciation expense for june using a 25% depreciation rate.\n(in $000) begin inv…

calculate the inventory depreciation expense for june using a 25% depreciation rate.\n(in $000) begin inv. purchases cogs\njune 70 30 40\njuly 60 10 50\naugust 20 50 30

calculate the inventory depreciation expense for june using a 25% depreciation rate.\n(in $000) begin inv. purchases cogs\njune 70 30 40\njuly 60 10 50\naugust 20 50 30

Answer

Explanation:

Step1: Calculate ending inventory for June

First, find the cost of goods available for sale in June which is the sum of beginning inventory and purchases. Then subtract the cost - of - goods sold (COGS). Cost of goods available for sale in June = $70 + 30=100$ (in $000$). Ending inventory for June = $100 - 40 = 60$ (in $000$).

Step2: Calculate depreciation expense

Multiply the ending inventory value by the depreciation rate. Depreciation expense = $60\times0.25 = 15$ (in $000$).

Answer:

$15000$