Question

Wiose mu ments. em Journalize for Big Fis were on credit. Assu cording the entry for A Journalize the following for Big Fish Company under the perpetual system: 1. Total August purchases in one summary entry. All purchases were on credit. 2. Total August sales and cost of goods sold in two summary entries. The selling price was $625 per unit, and all sales were on credit. Assume that Big Fish uses the FIFO inventory method. 3. Under FIFO, how much gross profit would Big Fish earn on for the month ending August 31? What is the FIFO cost of Big Fish Company's ending inventory? Print Done] m any list or enter any number tempuhelds and the CICK CHECK Answer Clear All hing EVET 5 EV ET o ch ! 3 e 2 9

Answer 1

Date	Accounts	Debit	Credit
1.	Inventory ($805+1870)	$2675
	Accounts payable		$2675
	(To record inventory purchased on credit)
2.	Accounts receivable (15*$625)	$9375
	Sales		$9375
	(To record inventory sold on credit)
	Cost of goods sold (9*$160+5*$161+1*$170)	$2415
	Merchandise inventory		$2415
	(To record cost of goods sold of the inventory sold)

Ending inventory units= 10 units

Total units= 9+5+11= 25 units

Sales units= Total units-Ending inventory units

= 25-10= 15 units

3) Gross profit= Sales-Cost of goods sold

= $9375-2415= $6960

4) Ending inventory= 10*$170= $1700