Esperado Furnishings are retailers who purchase and sellhousehold furnishings, including table lamps. The business uses aperpetual inventory system and adjusts cost of goods sold for anyshortage or excess inventory. The business began the last quarterof 2018 with merchandise inventory of 10 pairs of “Italia” tablelamps at a total cost of $168,200.

The following transactions, relating to the “Italia” brand werecompleted during the quarter:

October 5 Purchased 15 pairs of lamps at a cost of $17,020 perpair.

October 14 Sold 18 pairs of lamps to Muller Furnishings at$22,250 per pair

October 22 Purchased 24 pairs at a cost of $18,175 per pair butthe supplier gave a 4% quantity discount.

November 10 Sold 15 pairs of lamps to Orion Household Ltd and 10pairs to Brown’s Furnishings which yielded total sales revenue of$589,750.

November 12 Owing to an increased demand for this product, 30pairs of lamps were purchased on account at a cost of $17,612 perpair. In addition, Esperado paid $288 in cash on each pair of lampsto have the inventory shipped from the vendor’s warehouse toEsperado’s showroom.

November 27 Sold 23 pairs of lamps to Middletown Company at aprice of $25,080 per pair.

November 30 An actual count of inventory was carried out whichrevealed that there were 15 pairs of the “Italia” brand in thewarehouse.

December 2 In preparation for the festive season, Esperadopurchased 25 pairs of lamps at a total cost of $474,500.

December 15 5 pairs of the lamps purchased on December 2 werereturned to the supplier, as they were not of the brandordered.

December 30 Sold 22 pairs of lamps to two customers (OmegaTraders & Middleton Furnishings) at a selling price of $26,550per pair. All purchases were on account and received on the datesstated. Required:

A) Prepare a perpetual inventory record for EsperadoFurnishings, using the first in, first out (FIFO) method todetermine the value of ending inventory at December 31, 2018, andthe total amount to be assigned to cost of goods sold for theperiod.

B) Given that selling, distribution and administrative costs forthe quarter were $23,445, $10,250 and$75,435 respectively, preparean income statement for Esperado Furnishings for the period, todetermine the net profit for the quarter, assuming the perpetualinventory system.

c) You are told that 8 pairs of lamps sold on November 27, 2018were on account. State the journal entries necessary to record thetransactions on November 12 and November 27, assuming the businessuses a: - Perpetual inventory system - Periodic inventorysystem

D) Assuming that Esperado sold 86 pairs of “Italia” brand oflamps during the quarter; determine the value of ending inventoryand cost of goods sold assuming the business used the periodicsystem and the LIFO method?