Problem

Journalizing perpetual inventory transactions—cost of sales given [10-15 min]Accounting re...

Journalizing perpetual inventory transactions—cost of sales given [10-15 min]

Accounting records for Josh’s Shopping Bags yield the following data for the year ended May 31, 2012:

Inventory, May 31, 2011. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

$    8,000

Purchases of inventory (on account). . . . . . . . . . . . . . . . . . . . . . . . . . .

46,000

Sales of inventory - 81% on account; 19% for cash (cost $38,000) . . .

76,000

Inventory, May 31, 2012. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

?

Requirements

1. Journalize the inventory transactions for the company using the data given.


2. Report ending inventory on the balance sheet, and sales, cost of goods sold, and gross profit on the income statement.

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