In March 2021, the Phillips Tool Company signed two purchase commitments. The first commitment requires Phillips...
In March 2021, the Phillips Tool Company signed two purchase
commitments. The first commitment requires Phillips to purchase
inventory for $116,000 by June 15, 2021. The second commitment
requires the company to purchase inventory for $166,000 by August
20, 2021. The company's fiscal year-end is June 30. Phillips uses a
periodic inventory system.
The first commitment is exercised on June 15, 2021, when the market
price of the inventory purchased was $93,000. The second commitment
was exercised on August 20, 2021, when the market price of the
inventory purchased was $128,000.
Required:
Prepare the journal entries required on June 15, June 30, and
August 20, 2021, to account for the two purchase commitments.
Assume that the market price of the inventory related to the
outstanding purchase commitment was $146,400 at June 30.
Homework Answers
please comment if any
doubt
Thank you
Add Answer to:
In March 2021, the Phillips Tool Company signed two purchase
commitments. The first commitment requires Phillips...
In November 2018, the Brunswick Company signed two purchase commitments. The first commitment requires Brunswick to purc...
In November 2018, the Brunswick Company signed two purchase commitments. The first commitment requires Brunswick to purchase 25,000 units of inventory at $9 per unit by December 15, 2018. The second commitment requires the company to purchase 35,000 units of inventory at $10 per unit by March 15, 2019. Brunswick’s fiscal year-end is December 31. The company uses a periodic inventory system. Both contracts were exercised on their expiration date. Required: 1. Prepare the journal entry to record the December...
Problem 9-18 Purchase commitments (Appendix] In November 2018, the Brunswick Company signed two purchase commitments. T...
Problem 9-18 Purchase commitments (Appendix] In November 2018, the Brunswick Company signed two purchase commitments. The first commitment requires Brunswick to purchase 17,000 units of inventory at $14 per unit by December 15, 2018. The second commitment requires the company to purchase 27,000 units of inventory at $15 per unit by March 15, 2019. Brunswick's fiscal year-end is December 31. The company uses a periodic inventory system. Both contracts were exercised on their expiration date. Required: 1. Prepare the journal...
On October 6, 2021, the Elgin Corporation signed a purchase commitment to purchase inventory for $81,000...
On October 6, 2021, the Elgin Corporation signed a purchase commitment to purchase inventory for $81,000 on or before March 31, 2022. The company's fiscal year-end is December 31. The contract was exercised on March 21, 2022, and the inventory was purchased for cash at the contract price. On the purchase date of March 21, the market price of the inventory was $61,000. The market price of the inventory on December 31, 2021, was $70,00o. The company uses a perpetual...
On July 10, 2018, Johnson Corporation signed a purchase commitment to purchase inventory for $300,000 on...
On July 10, 2018, Johnson Corporation signed a purchase commitment to purchase inventory for $300,000 on or before February 15, 2019. The company's fiscal year-end is December 31. The contract was exercised on February 1, 2019, and the inventory was purchased for cash at the contract price. On the purchase date of February 1, the market price of the inventory was $311,000. The market price of the inventory on December 31, 2018, was $277,000. The company uses a perpetual inventory...
On October 6, 2018, the Elgin Corporation signed a purchase commitment to purchase inventory for $66,000...
On October 6, 2018, the Elgin Corporation signed a purchase commitment to purchase inventory for $66,000 on or before March 31, 2019. The company's fiscal year-end is December 31. The contract was exercised on March 21, 2019, and the inventory was purchased for cash at the contract price. On the purchase date of March 21, the market price of the inventory was $56,000. The market price of the inventory on December 31, 2018, was $60,000. The company uses a perpetual...
View previous attempt On July 10. 2018. Johnson Corporation signed a purchase commitment to purchase inventory...
View previous attempt On July 10. 2018. Johnson Corporation signed a purchase commitment to purchase inventory for $350,000 on or before February 15, 2019. The company's fiscal year-end is December 31. The contract was exercised on February 1, 2019, and the inventory was purchased for cash at the contract price. On the purchase date of February 1, the market price of the inventory was $362,000. The market price of the inventory on December 31, 2018, was $330,000. The company uses...
Windsor Company signed a long-term noncancelable purchase commitment with a major supplier to purchase raw materials...
Windsor Company signed a long-term noncancelable purchase commitment with a major supplier to purchase raw materials in 2021 at a cost of $981,000. At December 31, 2021, the raw materials to be purchased have a market value of $932,500. Prepare any necessary December 31, 2021 entry. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) Account Titles...
Brief Exercise 9-08 Sunland Company signed a long-term noncancelable purchase commitment with a major supplier to...
Brief Exercise 9-08 Sunland Company signed a long-term noncancelable purchase commitment with a major supplier to purchase raw materials in 2021 at a cost of $919,600. At December 31, 2020, the raw materials to be purchased have a market value of $869,100. In 2021, Sunland paid $919,600 to obtain the raw materials which were worth $869,100. Prepare the entry to record the purchase. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry...
Silverado Inc. buys titanium from a supplier that requires a six-month firm commitment on all pur...
Silverado Inc. buys titanium from a supplier that requires a six-month firm commitment on all purchases. On January 1, 2011, Silverado signs a contract with the supplier to purchase 10,000 pounds of titanium at the current forward rate of $310 per pound with settlement on June 30, 2011. However, Silverado wants to actually pay the June 30 market price for titanium. To achieve this goal, the company enters into a forward contract to sell 10,000 pounds of titanium at the...
Grouper Corp., a public company using IFRS, signed a long-term non-cancellable purchase commitment with a major...
Grouper Corp., a public company using IFRS, signed a long-term non-cancellable purchase commitment with a major supplier to purchase raw materials at an annual cost of $2,600,000. At December 31, 2019, the raw materials to be purchased in 2020 have a market price of $2,540,000. Prepare any December 31, 2019 entry that is needed. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account...
Problem 9-18 Purchase commitments (Appendix] In November 2018, the Brunswick Company signed two purchase commitments. The first commitment requires Brunswick to purchase 17,000 units of inventory at $14 per unit by December 15, 2018. The second commitment requires the company to purchase 27,000 units of inventory at $15 per unit by March 15, 2019. Brunswick's fiscal year-end is December 31. The company uses a periodic inventory system. Both contracts were exercised on their expiration date. Required: 1. Prepare the journal...
On October 6, 2021, the Elgin Corporation signed a purchase commitment to purchase inventory for $81,000 on or before March 31, 2022. The company's fiscal year-end is December 31. The contract was exercised on March 21, 2022, and the inventory was purchased for cash at the contract price. On the purchase date of March 21, the market price of the inventory was $61,000. The market price of the inventory on December 31, 2021, was $70,00o. The company uses a perpetual...
View previous attempt On July 10. 2018. Johnson Corporation signed a purchase commitment to purchase inventory for $350,000 on or before February 15, 2019. The company's fiscal year-end is December 31. The contract was exercised on February 1, 2019, and the inventory was purchased for cash at the contract price. On the purchase date of February 1, the market price of the inventory was $362,000. The market price of the inventory on December 31, 2018, was $330,000. The company uses...
Windsor Company signed a long-term noncancelable purchase commitment with a major supplier to purchase raw materials in 2021 at a cost of $981,000. At December 31, 2021, the raw materials to be purchased have a market value of $932,500. Prepare any necessary December 31, 2021 entry. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter O for the amounts.) Account Titles...
Brief Exercise 9-08 Sunland Company signed a long-term noncancelable purchase commitment with a major supplier to purchase raw materials in 2021 at a cost of $919,600. At December 31, 2020, the raw materials to be purchased have a market value of $869,100. In 2021, Sunland paid $919,600 to obtain the raw materials which were worth $869,100. Prepare the entry to record the purchase. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry...
Silverado Inc. buys titanium from a supplier that requires a six-month firm commitment on all purchases. On January 1, 2011, Silverado signs a contract with the supplier to purchase 10,000 pounds of titanium at the current forward rate of $310 per pound with settlement on June 30, 2011. However, Silverado wants to actually pay the June 30 market price for titanium. To achieve this goal, the company enters into a forward contract to sell 10,000 pounds of titanium at the...
Most questions answered within 3 hours.
-
Suppose that on a temperature scale X, water boils at 203.0°X
and freezes at -105.7°X. What...
asked 14 minutes ago -
BaS crystallizes in a cubic unit cell with S2- ions on each
corner and each face....
asked 45 minutes ago -
A. 0≤P(Oi)≤10≤P(Oi)≤1 for each i
B. P(Oi)≤0P(Oi)≤0
C. P(Oi)=1+P(OCi)P(Oi)=1+P(OiC)
D. P(Oi)≥1P(Oi)≥1
If an experiment consists of...
asked 2 hours ago -
A battery has an emf of 9.20V and an internal resistance of 1.20
ohm. a)What resistance...
asked 2 hours ago -
The area of an elastic circular loop decreases at a constant
rate, dA/dt = −6.60×10−3 m2/s...
asked 3 hours ago -
The denaturation of proteins can be described by the
equilibrium
F⇌U
where F and U represent...
asked 4 hours ago -
Please answer what the maximum and minimum force is, and the
angle on the ion is...
asked 4 hours ago -
implement a program that reads a number of rows and a symbol.
The program will draw...
asked 5 hours ago -
Assume that when adults with smartphones are randomly selected,
45% use them in meetings or classes....
asked 5 hours ago -
Determine the number of formula units of
Na2SO4 and moles of oxygen contained in 8.11
moles...
asked 5 hours ago -
Explain in steps on the following code
What would be the output when executed
using System;...
asked 5 hours ago -
Given the information in the table, which of the following
statements is CORRECT?
Stock A
Stock...
asked 5 hours ago