Question

1. Journalize the following merchandise transactions: () Sold merchandise on account, $17,300, with terms 2/10, net 30. The cost of the merchandise sold was $12,600. (b) Received payment within the discount period. 2. Beginning inventory, purchases, and sales data for hammers are as follows: Mar. 3 Inventory 12 units at $15 11 Purchase 13 units at $17 14 Sale 18 units 21 Purchase 9 units at $20 25 Sale 10 units Assuming the business maintains a perpetual inventory system, complete the subsidiary inventory ledger and calculatet cost of merchandise sold and ending inventory under the following assumptions: (a) First-in, first-out Purchases Cost of Merchandise Sold Inventory Unit Cost Total Total Cost Qty. Unit Cost Total Cos! Qty. Unit Cost Total Cost Qty. Qty. Qty. Unit Cost Total Cost Date Mar. 3 Balances

Answer 1

1. A - Sale transaction

a. Sale entry :

Debtors A/c Dr 17300

To Sales A/c Cr 17300

b. Cost of goods sold :

Cost of goods sold A/c Dr 12600  

To Inventory A/c Cr 12600

2. B Collection Entry

Bank A/c Dr 17300

To Debtor A/c Cr 17300

First in First Out
Date	Purchase			Cost of materials sold			Inventory
	Qty	Unit Cost	Total Cost	Qty	Unit Cost	Total Cost	Qty	Unit Cost	Total Cost
3-Mar							12.0	15.0	180.0
11-Mar	13.0	17.0	221.0				25.0	16.0	401.0
14-Mar				18.0	15.7	282.0	7.0	17.0	119.0
21-Mar	9.0	20.0	180.0				16.0	18.7	299.0
25-Mar				10.0	17.9	179.0	6.0	20.0	120.0
For the period 3 Mar to 25th Mar	22.0	18.23	401.0	28.0	16.46	461.0
Closing inventory							6.0	20.0	120.0
Last in First Out
Date	Purchase			Cost of materials sold			Inventory
	Qty	Unit Cost	Total Cost	Qty	Unit Cost	Total Cost	Qty	Unit Cost	Total Cost
3-Mar							12.0	15.0	180.0
11-Mar	13.0	17.0	221.0				25.0	16.0	401.0
14-Mar				18.0	16.4	296.0	7.0	15.0	105.0
21-Mar	9.0	20.0	180.0				16.0	17.8	285.0
25-Mar				10.0	19.5	195.0	6.0	15.0	90.0
For the period 3 Mar to 25th Mar	22.0	18.23	401.0	28.0	17.54	491.0
Closing inventory							6.0	15.0	90.0

S.No	Nature of account	DR / CR	Remarks	Additional info
1	Utilities Payable	Cr	Would be carried fwd to next year	NA
2	Utilities expenses	Dr	To be closed
3	Supplies ( Material purchase - assumed	Dr	To be closed
4	Supplies expeneses	Dr	To be closed
5	Fees Earned	Cr	To be closed
6	Un earned fees	Dr	Would be carried fwd to next year	NA
7	Account receivable	Dr	Would be carried fwd to next year	NA
8	Jason hill drawings	Cr	To be closed
9	Jason hill capital	Cr	Would be carried fwd to next year	NA
10	Accumulated depreciation - Equipment	Dr	Would be carried fwd to next year	NA
11	Depreciation expenses - equipement	Dr	To be closed
12	Equipment	Dr	Would be carried fwd to next year	NA
13	Prepaid insurance	Dr	Would be carried fwd to next year	NA
14	Insurance expeneses	Dr	To be closed