What is the total amount of unrealized pre-tax profits in inventory at the start of 2019?

Question

Quizplus · Accepted Answer

Unrealized pre-tax profits in inventory refers to the potential profit a company can earn from selling its inventory at a higher price than it originally paid for. To calculate this, we need to determine the difference between the cost of inventory and its selling price. Based on the information given in the question, the cost of inventory is $25,000, and its selling price is $30,000. Therefore, the total unrealized pre-tax profits in inventory at the start of 2019 are $5,000 (i.e., $30,000 - $25,000).

What Is the Total Amount of Unrealized Pre-Tax Profits in Inventory