Question

jan. 1 inventory 10,000 units

The beginning inventory at Dunne Co. and data on purxhasea

iru Perpetual inventory The beginning inventory at Dunne Co. and data on purchases and sales for a three-month period ending June ding June 30 are as follows: Number of Units Date Apr. 3 Per Unit Total Transaction Inventory Purchase 42 $450 $18,900 8 540 1,500 11 Sale Sale 1,500 30 May 8 Purchase 600 1,500 Sale Sale 1,500 660 19 28 June 5 16 21 28 45,360 84,000 52,500 42,000 63,000 31,500 46,200 66,150 88,200 90,720 99,225 Purchase Sale Sale Purchase Sale 1,575 1,575 720 1,575 Required: 1. Record the inventory, purchases, and cost of merchandise sold data in a perpetual inventory record similar to the one illustra cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column.

Answer 1

Recording of Entries in General Way

INVENTORY
DATE	PARTICULAR	UNIT	RATE	TOTAL
April 3	Inventory	42	$450	$18,900
PURCHASE A/C
April 8	Stock Purchase	84	$540	$45,360
May 8	Stock Purchase	70	$600	$42,000
May 28	Stock Purchase	70	$660	$46,200
June 21	Stock Purchase	126	$720	$90,720
	TOTAL			$224,280
SALES A/C
April 11	Sales	56	$1500	$84,000
April 30	Sales	35	$1500	$52,000
May 10	Sales	42	$1500	$63,000
May 19	Sales	21	$1500	$31,500
June 5	Sales	42	$1575	$66,150
June 16	Sales	56	$1575	$88,200
June 28	Sales	63	$1575	$99,225
	TOTAL			$484,075

INCOME / PROFIT / SURPLUS comes from this Transaction

Sales - ( Inventory + Purchases )

= $484,075 - ( $18,900 + $224,280 )

= $240,895

Perpetual Inventory System

   Perpetual inventory system updates inventory accounts after each purchase or sale.

      Inventory subsidiary ledger is updated after each transaction.
      Inventory quantities are updated continuously.

Journal Entry under PIS Basis

Date	Particular	L/F	Debit	Credit
April 3	Inventory To Accounts payable		$18,900	$18,900
April 8	Inventory To Accounts payable		$45,360	$45,360
April 11	Account Receivable To Sales A/c		$84,000	$84,000
April 11	COGS ( 42 * $450 + 14 * $540 ) To Inventory		$26,460	$26,460
April 30	Account Receivable To Sales A/c		$52,000	$52,000
April 30	COGS ( 35 * $540 ) To Inventory		$18,900	$18,900
May 8	Inventory To Accounts payable		$42,000	$42,000
May 10	Account Receivable To Sales A/c		$63,000	$63,000
May 10	COGS ( 35 * $540 + 7 * 600 ) To Inventory		$23,100	$23,100
May 19	Account Receivable To Sales A/c		$31,500	$31,500
May 19	COGS ( 21 * 600 ) To Inventory		$12,600	$12,600
May 28	Inventory To Accounts payable		$46,200	$46,200
June 5	Account Receivable To Sales A/c		$66,150	$66,150
June 5	COGS ( 42 * 600 ) To Inventory		$25,200	$25,200
June 16	Account Receivable To Sales A/c		$88,200	$88,200
June 16	COGS ( 56 * 660 ) To Inventory		$36,960	$36,960
June 21	Inventory To Accounts payable		$90,720	$90,720
June 28	Account Receivable To Sales A/c		$99,225	$99,225
June 28	COGS ( 14 * 660 + 49 * 720) To Inventory		$44,520	$44,520