Question

Use the following information to answer Exercises E6-16 through E6-18. Golf Unlimited carries an inventory of putters and other golf clubs. The sales price of each putter is $119. Company records indicate the following for a particular line of Golf Unlimited's putters: Date Item Quantity Unit Cost $ 53 Nov. 1 Balance Sale Purchase Sale Sale 70 17 Learning Objective 2 E6-16 Measuring and journalizing merchandise inventory and cost of goods sold-FIFO 1. COGS $3,232 Requirements 1. Prepare a perpetual inventory record for the putters assuming Golf Unlimited uses the FIFO inventory costing method. Then identify the cost of ending inventory and cost of goods sold for the month. 2. Journalize Golf Unlimited's inventory transactions using the FIFO inventory cost- ing method. (Assume purchases and sales are made on account.)

Please explain your question. Thank you.

Answer 1

1
		Purchase			Cost of Goods Sold			Inventory on Hand
	Date	Quantity	Unit cost	Total Cost	Quantity	Unit cost	Total Cost	Quantity	Unit cost	Total Cost
	Nov 1							24	$53	$1,272
	Nov 6				20	$53	$1,060	4	$53	$212
	Nov 8	30	$70	$2,100				4	$53	$212
								30	$70	$2,100
	Nov 17				4	$53	$212
					26	$70	$1,820	4	$70	$280
	Nov 30				2	$70	$140	2	$70	$140
	Cost of ending inventory			$140
	Cost of goods sold			$3,232
2
Date	Accounts and Explanation	Debit	Credit
Nov 6	Accounts Receivable	$2,380
	Sales Revenue		$2,380
	Cost of Goods Sold	$1,060
	Merchandise Inventory		$1,060
Nov 8	Merchandise Inventory	$2,100
	Accounts Payable		$2,100
Nov 17	Accounts Receivable	$3,570
	Sales Revenue		$3,570
	Cost of Goods Sold	$2,032
	Merchandise Inventory		$2,032
Nov 30	Accounts Receivable	$238
	Sales Revenue		$238
	Cost of Goods Sold	$140
	Merchandise Inventory		$140