Question

During February, Greg’s Groceries purchased $50,000 and sold $54,000 of inventory for $75,000. Greg’s Groceries had...

During February, Greg’s Groceries purchased $50,000 and sold $54,000 of inventory for $75,000. Greg’s Groceries had $10,000 worth of inventory on hand on February 28th. Complete the T account for Greg’s Inventory. How much Revenue does Greg’s have? _______________ How much expense? ___________________What is their Gross Margin? _____________ How much inventory did Greg’s have on hand on February 1 (beginning of the month)? __________

Write the journal entry to record Greg’s purchases:

Write the journal entry to record Greg’s revenue:

Write the journal entry to record Greg’s expense (COGS):

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Answer #1
1..Journal entry to record Greg’s purchases:
Inventory 50000
Cash/Accounts Payable 50000
2..Journal entry to record Greg’s revenue:
Cash/Accounts Receivable 75000
Sales Revenue 75000
3.Journal entry to record Greg’s expense (COGS):
COGS 54000
Inventory 54000
Inventory a/c
Beginning balance(Bal.fig.) 14000
Purchases-Cash/Accounts Payable 50000
COGS 54000
Closing balance 10000
64000 64000
Revenue does Greg’s have (Sales) 75000
Greg's expense 54000
Gross margin(75000-54000) 21000
Inventory a/c
Beginning balance on Feb 1 14000
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