Question

Daily Assignment 2 (1/13/2020) You can either answer the problems directly on this document or use other paper. Scan and submit your answers on Canvas by 8 AM on Wednesday, January gih Problem 1: Periodic vs. Perpetual Inventory Beaver Company only sells one product and uses FIFO. All purchases and sales are made on account, Below is information for January for this one product: 1 Inventory 100 units at $5 each Jan. 80 units at $8 cach 4 Sale 150 units at $6 each Purchase 11 120 units at $8.75 each 13 Sale 20 Purchase 160 units at $7 each 100 units at $9 each 27 Sale Instructions: 1. Assume that Beaver uses the periodic system, and the end of period ending inventory for January is 110 units. a. Prepare all necessary journal entries to record the transactions above including end-of-month closing entry to record cost of goods sold.

Answer 1

Beaver Company Periodic FIFO FIFO Perpetual Closing Inventory Units Date Jan-01 Jan-04 20 100 Date Jan-20 Units 110 Unit Cost Total Cost 770 Jan-11 150 20 Cost of goods sold Jan-13 Purchases Cost of goods sold Balance Unit Cost Total Cost Units Unit Cost Total Cost Units Unit Cost Total Cost 100 500 80 5 400 6 900 100 150 6 900 20 5 100 300 100 6 600 7 1120 50 300 160 1120 6 300 110 770 350 110 17 770 Jan-20 160 Date Jan-01 Units 100 150 Jan-11 Jan-27 Jan-20 160 Unit Cost Total Cost 500 900 1120 2520 Clos. Stk. -770 COGS 1750 Jan-31 Less 410 -110 300 Purchases 2020 COGS 1750 Ending 770 Calculation Gross Profit Calculation Gross Profit Sales Date Jan-04 Jan-13 Jan-27 Units Unit Cost Total Cost 80 640 120 8.75 1050 100 9 900 300 2590 Less:COGS - 1750 Gross Profit 840 Sales Date Jan-04 Jan-13 Jan-27 Units Unit Cost Total Cost 80 640 120 8.75 1050 100 9 900 300 2590 Less:COGS -1750 Gross Profit 840

Journal Enteries Date Particulars Jan-04 Accounts Receivable a/c To Sales (Sales on account) Dr. Debit in $ Credit in 640 640 Dr. 400 Cost of goods sold a/c To Inventory (To record cost of goods sold) 400 Jan-11 Dr. 900 Inventory a/c To Accounts Payable (Inventory on account) 900 Jan-13 Dr. 1050 Accounts Receivable a/c To Sales (Sales on account) 1050 Dr. 700 Cost of goods sold a/c To Inventory (To record cost of goods sold) 700 Jan-20 Dr. 1120 Inventory a/c To Accounts Payable (Inventory on account) 1120 Dr. 900 Jan-27 Accounts Receivable a/c To Sales (Sales on account) 900 Dr. 650 Cost of goods sold a/c To Inventory (To record cost of goods sold) 650