Question

JOURNAL ENTRIES AND EVENTS INCLUDE PLEASE PROVIDE CORRECT T ACCOUNTS TO CHECK MINE AGAINST

Bower Consulting Company started the period with cash of $25,000, 500 units of inventory with a cost of $20,000 (uses FIFO) , common stock of $20,000 and retained earnings of $25,000. Bower engaged in the following transactions in 2013:
Transactions during 2013
Purchased with cash 50 units of inventory for $2,500
Purchased on account 250 units of inventory for $14,000
Sold 750 units of inventory for $112,500. This was a cash sale
Sold 10 units of inventory for $1,500. This was a cash sale
Made a partial refund for 8 units to the customer who purchased the 10 units in the transaction above.
Information for Adjusting Entries
Bower carries only one type of inventory item. At year end the market value of each unit of inventory was $45 per unit.
Re-evaluate the value of the ending inventory and prepare the necessary journal entry, assuming Bower applies the lower of cost or market rule to individual items

Bower Consulting Company
General Journal, 2013
Event	Account Titles	Debit	Credit
1	INVENTORY	2500
	CASH		2500
2	INVENTORY	14000
	ACCOUNTS PAYABLE		14000
3	CASH	112500
	SALES REVENUE		112500
3	COST OF GOODS SOLD	33700
	INVENTORY		33700
4	CASH	1500
	SALES		1500
4	COST OF GOODS SOL	560
	INVENTORY		560
5	SALES RETURN	1200
	CASH		1200
5	INVENTORY	448
	COST OF GOODS SOLD		448
6	PROFIT LOSS CGS	528
	INVENTORY		528

Answer 1

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Bower Consulting Company
T accounts
Inventory
Date	Account	Debit $	Date	Account	Credit $
	Opening Balance	20,000.00	3	Cost of good sold	33,700.00
1	Cash	2,500.00	4	Cost of good sold	560.00
2	Accounts Payable	14,000.00	6	Profit and loss	528.00
5	Cost of good sold	448.00		Closing Balance	2,160.00	This is balancing figure.
		36,948.00			36,948.00
	Opening Balance	2,160.00
Cash
Date	Account	Debit $	Date	Account	Credit $
			1	Inventory	2,500.00
3	Sales	112,500.00	5	Sales returns	1,200.00
4	Sales	1,500.00		Closing Balance	112,800.00	This is balancing figure.
		114,000.00			114,000.00
	Opening Balance	112,800.00
Accounts Payable
Date	Account	Debit $	Date	Account	Credit $
	Closing Balance	14,000.00	2	Inventory	14,000.00
	This is balancing figure.	14,000.00			14,000.00
				Opening Balance	14,000.00
Sales
Date	Account	Debit $	Date	Account	Credit $
	Profit and loss	114,000.00	3	Cash	112,500.00
	This is balancing figure.		4	Cash	1,500.00
		114,000.00			114,000.00
Sales returns
Date	Account	Debit $	Date	Account	Credit $
3	Cash	1,200.00		Profit and loss	1,200.00	This is balancing figure.
		1,200.00			1,200.00
Cost of good sold
Date	Account	Debit $	Date	Account	Credit $
3	Inventory	33,700.00	5	Inventory	448.00
4	Inventory	560.00		Profit and loss	33,812.00	This is balancing figure.
		34,260.00			34,260.00
Profit and loss
Date	Account	Debit $	Date	Account	Credit $
	Cost of good sold	33,812.00		Sales	114,000.00
	Sales returns	1,200.00
	Inventory	528.00
	Retained Earnings	78,460.00
	This is balancing figure.	114,000.00			114,000.00
Retained Earnings
Date	Account	Debit $	Date	Account	Credit $
	Closing Balance	103,460.00		Opening Balance	25,000.00
	This is balancing figure.			Profit and loss	78,460.00
		103,460.00			103,460.00
				Opening Balance	103,460.00