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This assignment is a continuation of the Cookie Creations case study from previous chapters. From the information gathered in the previous chapters, read the continuation of the Cookie Creations case study below for Chapter 5 and Chapter 6, which can also be found on p. 5-51 and p. 6-45.

The case study allows you to apply what you have learned about accounting for merchandising operations (Chapter 5) and inventories (Chapter 6). This assignment will allow you to practice what you have learned so far.

Part I
Because Natalie has had such a successful first few months, she is considering other opportunities to develop her business. One opportunity is the sale of European mixers. The owner of Kzinski Supply Company has approached Natalie to become the exclusive distributor of these fine mixers in her state. The current cost of a mixer is approximately $575, and Natalie would sell each one for $1,150. Natalie comes to you for advice on how to account for these mixers. Each appliance has a serial number and can be easily identified.

Natalie has come to you for your advice on how to account for these mixers and asks you the questions below, which you must address.

Would you consider these mixers to be inventory, or should these mixers be classified as supplies or equipment?
Which inventory tracking system should Natalie use: perpetual or periodic?
Which system do you think is better: perpetual or periodic?
Which system would you recommend for the type of inventory that Natalie wants to sell?
How often does Natalie need to count inventory if she maintains it using the perpetual system? In contrast, does she need to count inventory at all?

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