Question

Seemore Lens Company (SLC) sells contact lenses FOB destination. For the year ended December 31, the company reported Inventory of $82,000 and Cost of Goods Sold of $444,000.

1. Included in Inventory (and Accounts Payable) are $12,400 of lenses SLC is holding on consignment.
2. Included in SLC’s Inventory balance are $6,200 of office supplies held in SLC’s warehouse.
3. Excluded from SLC’s Inventory balance are $9,200 of lenses in the warehouse, ready to send to customers on January 2. SLC reported these lenses as sold on December 31, at a price of $17,400.
4. Included in SLC’s Inventory balance are $3,600 of lenses that were damaged in December and will be scrapped in January, with zero realizable value.

Required:

For each item, (a)-(d), prepare the journal entry to correct the balances presently reported. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

Answer 1

Sr no.	Journal	debit	credit
A)	account payable	$12400
	To inventory		$12400
B)	office supplies	$6200
	To inventory		$6200
C)(1)	inventory	$9200
	To cost of goods sold		$9200
D)	inventory loss / provision for damaged inventory	$3600
	To inventory		$3600

C(2)	sales	$17400
	To account receivable		$17400

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