1 Supply inventory 1400 2 Depreciation Machinery Equipment

1. Supply inventory $1,400 2. Depreciation Machinery & Equipment $50,000 Motor Vehicle $5,000 3. Merchandise Inventory $205,000

Solution

Merchandise Inventory ( $2,05,000) + Supply Inventory ($1,400) = $2,06,400 - Machinery & Equipment , Motor Vehicle ($50,000 + $5,000) = $ 151,400

As per this the net value of the inventory is remain in the business is around $ 1,51,400 which show that the expense is more this is directly effect to the Net Profit of the business and the Cost of good sold will be high.