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Problem 5-20A Allocating product costs between cost of goods sold and ending inventory: intermittent purchases and...

Problem 5-20A Allocating product costs between cost of goods sold and ending inventory: intermittent purchases and sales of merchandise LO 5-1

[The following information applies to the questions displayed below.]

Pam’s Creations had the following sales and purchase transactions during Year 2. Beginning inventory consisted of 130 items at $81 each. The company uses the FIFO cost flow assumption and keeps perpetual inventory records.
  

Date Transaction Description
Mar. 5 Purchased 110 items @ $ 91
Apr. 10 Sold 75 items @ $ 177
June 19 Sold 125 items @ $ 177
Sept. 16 Purchased 60 items @ $ 96
Nov. 28 Sold 65 items @ $ 182

Problem 5-20A Part a

Required
a. Record the inventory transactions in general journal format. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)

Record entry inventory purchased for cash.

Record sale of inventory for cash.

Record entry for cost of goods sold.

Record sale of inventory for cash.

Record entry for cost of goods sold.

Record entry inventory purchased for cash.

Record sale of inventory for cash

Record entry for cost of goods sold

Business   Accounting   
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Homework Answers

Answer #1

Journal entries

No Account and explanation Debit Credit
Mar 5 Merchandise inventory (110*91) 10010
Account payable 10010
Apr 10 Account receivable (75*177) 13275
Sales revenue 13275
Apr 10 Cost of goods sold (75*81) 6075
Merchandise inventory 6075
June 19 Account receivable (125*177) 22125
Sales revenue 22125
June 19 Cost of goods sold (55*81+70*91) 10825
Merchandise inventory 10825
Sep 16 Merchandise inventory (60*96) 5760
Account payable 5760
Nov 28 Account receivable (65*182) 11830
Sales revenue 11830
Nov 28 Cost of goods sold (40*91+25*96) 6040
Merchandise inventory 6040
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