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December 31, 20x1 January 2, 20x1: 1. A. Fob Shipping Point, Freight Collect
December 31, 20x1 January 2, 20x1: 1. A. Fob Shipping Point, Freight Collect
1.
A. FOB SHIPPING POINT, FREIGHT COLLECT
Purchase 100,000
December 31, Accounts Payable 100,000
20x1 To record purchases on account
Freight-In 10,000
January 2, 20x1 Cash 10,000
To record payment of accounts payable
Accounts Payable 100,000
January 5, 20x1 Cash 100,000
To record settlement of accounts payable.
December 31,
NO ENTRY
20x1
Purchases 100,000
January 2, 20x1 Accounts Payable 100,000
To record purchase on account.
Accounts Payable 100,000
January 5, 20x1 Cash 100,000
To record settlement of accounts payable.
Purchase 100,000
December 31, Freight-In 10,000
20x1 Accounts Payable 110,000
To record purchases on account.
December 31,
NO ENTRY
20x1
Purchases 100,000
Accounts Payable 100,000
To record purchase on account.
January 2, 20x1
Accounts Payable 10,000
Cash 10,000
To record settlement on Accounts Payable.
Accounts Payable 90,000
January 5, 20x1 Cash 90,000
To record settlement of accounts payable.
2.
PERPETUAL PERIODIC
A. Purchased goods worth 50,000 on account. Freight of 4,000 was paid on the shipment.
Inventory 54,000 Purchases 50,000
Accounts Payable 50,000 Freight-In 4,000
Cash 4,000 Accounts Payable 50,000
Cash 4,000
B. Returned damaged goods, costing 5,000 to the supplier.
Accounts Payable 5,000 Accounts Payable 5,000
Inventory 5,000 Purchase Return and allowance 5,000
C. Sold goods costing 30,000 for 90,000 on account.
Accounts Receivable 90,000 Accounts Receivable 90,000
Sales 90,000 Sales
90,000
COGS 30,000
Inventory
30,000
D. Received goods with sale price of 6,000 and cost of 2,000 from a customer.
Sales Returns 6,000 Sales Returns 6,000
Accounts Receivable Accounts Receivable 6,000
6,000
COGS 2,000
Inventory
2,000
3.
a. 10,000+198,000-112,000 = 96,000
b. 36,000+145,000-56,000 = 125,000
c. 64,000+9,000-15,000 = 49,900
d. 89,200+48,000-112,000 = 25,200
PROBLEM 4: COMPUTATIONAL
1) C ;b
2) A ;c
3) A ; d
4) C ; d
5) D ; c
6) A ; c
7) C ; a
8) B ;c
9) C ; d
10) B ;
11) C
12) A
13) C
14) B
15) C
16) A
17) A
18) B
19) C
20) A
PROBLEM 6: CLASSROOM DISCUSSION
1.
PERPETUAL PERIODIC
B. Gross Profit
6. 102,000
7. Perpetual and Periodic
PERPETUAL PERIODIC
A. Purchases of inventory on account- 450,000
Inventory 450,000 Purchases 450,000
Accounts Payable 450,000 Accounts Payable 450,000
B. Freight costs paid on purchase -25,000
Inventory 25,000 Freight-in 25,000
Cash 25,000 Cash 25,000
C. Damaged goods returned to suppliers- 10,000
Accounts Payable 10,000 Accounts Payable 10,000
Inventory 10,000 Purchase Return
10,000
D. Sales on account- 800,000 ; Cost of Sales – 380,000
Accounts receivable 800,000 Accounts receivable 800,000
Sales 800,000 Sales 800,000
COGS 380,000
Inventory 380,000
E. Sales returns- 9,000 sale price 4,275 cost
Sales Returns 9,000 Sales Returns 9,000
Account receivable 9,000 Account receivable 9,000
COGS 4,275
Inventory 4,275
8. FIFO (PERIODIC)
ENDING INVENTORY IN UNITS: 5,550
ENDING INVENTORY IN PESO: 117,300
COST OF GOODS SOLD: 207,000
FIFO (PERPETUAL)
ENDING INVENTORY IN UNITS: 5,550
ENDING INVENTORY IN PESO: 117,300
COST OF GOODS SOLD: 207,000
WEIGHTED AVERAGE (PERIODIC)
324,300/15,450= 20.99
Ending inventory in units 5,550
Multiply by: 20.99
Ending inventory at cost 116,495