Sabor Company, Inc. uses a perpetual inventory system and purchased $17,800 of merchandise on...
Question:
Sabor Company, Inc. uses a perpetual inventory system and purchased $17,800 of merchandise on April 7 with credit terms of 1/10, n/30. Merchandise with a cost of $1,800 was damaged and returned to the seller on April 10. On April 16, the company paid the amount due. Prepare the journal entries to record the transactions on all three dates.
Perpetual Inventory System:
As technology advanced, perpetual inventory system was already available to be used by companies to help in its inventory control but as no system is perfect there could still be overstatements and understatements so management is advised to still observe physical counts at year-end.
Answer and Explanation: 1
Become a Study.com member to unlock this answer! Create your account
View this answera. Sabor Company, Inc. uses a perpetual inventory system and purchased $17,800 of merchandise on April 7 with credit terms of 1/10, n/30.
| Account | Deb... |
|---|
See full answer below.
Ask a question
Our experts can answer your tough homework and study questions.
Ask a question Ask a questionSearch Answers
Learn more about this topic:
Get access to this video and our entire Q&A library
Perpetual Inventory System: Definition, Advantages & Examples
from
Chapter 1 / Lesson 15
50K
Perpetual inventory systems are used by businesses to monitor their inventories in real-time with the use of radio frequency identification, barcodes, point of sales, and other technological systems. Learn about the definition of a perpetual inventory system, the advantages of using this system, and some examples of perpetual inventory systems.
Related to this Question
- Connect Inc. uses the perpetual inventory system. On May 1, 2015 merchandise was sold on credit at an invoice price of $1,000, terms 3/10, n/30. The merchandise cost $600. Give the journal entries to record the sales, the collection on May 7,2015, and the
- A company sold merchandise for $20,000 on account with terms of 3/10, n/30. The company uses a perpetual inventory system. After two days, it received defective merchandise worth $2,000. The journal e
- A corporation uses the perpetual inventory system. On May 1, it sells merchandise on account for $10,000 with terms 2/10, n/30. The corporation had paid $6,000 to acquire the merchandise. On May 7, the customer returns merchandise with an invoice price of
- A company purchased $3,600 of merchandise on July 5 with terms of 2/10, n/30. On July 7, it returned $800 worth of merchandise. On July 12, it paid the full amount due. Assuming the company uses a perpetual inventory system and records purchases using the
- A company using the perpetual inventory system purchased inventory worth $450,000 on account with terms of credit being 3/15, n/45. Defective inventory of $50,000 was returned 2 days later, and the accounts were appropriately adjusted. If the company paid
- A company purchased $3,500 of merchandise on July 5 with terms 3/10, n/30. On July 7, it returned $700 worth of merchandise. On July 12, it paid the full amount due. Assuming the company uses a perpetual inventory system, and records purchases using the g
- A company purchased $2,500 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $550 worth of merchandise. On July 12, it paid the full amount due. Assuming the company uses a perpetual inventory system, and records purchases using the g
- A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $200 worth of merchandise. On July 28, it paid the full amount due. Assuming the company uses a perpetual inventory system, and records purchases using the g
- A company purchased $3,000 of merchandise on July 5 with terms 3/10, n/30. On July 7, it returned $800 worth of merchandise. On July 12, it paid the full amount due. Assuming the company uses a perpetual inventory system, and records purchases using the g
- A company purchased $2,600 of merchandise on July 5 with terms of 2/10, n/30. On July 7, it returned $325 worth of merchandise. On July 12, it paid the full amount due. Assuming the company uses a perpetual inventory system and records purchases using the
- Juniper Company, Inc. uses a perpetual inventory system. The company purchased $9,750 of merchandise on August 7 with terms 1/10, n/30. On August 11, it returned $1,500 worth of merchandise. On August 16, it paid the full amount due. The correct journal e
- Cosmos Corporation uses the perpetual inventory system. It purchased $2,000 of merchandise on July 5 on account. Credit terms were 2/10, n/30. It returned $400 of the merchandise on July 9. On July 21, it pays the supplier. Which of the following is part
- A company sold merchandise with a cost of $221 for $350 on account. The seller uses the perpetual inventory system. What journal entry is needed to record the cost of merchandise sold?
- A seller uses a perpetual inventory system, and on April 4, it sells $5,000 in merchandise (its cost is $2,400) to a customer on credit terms of 3/10, n/30. Prepare two journal entries to record the sales transaction. The first journal entry is to record
- A company using the perpetual inventory system purchased inventory worth 21,000 on account with terms of 3/10, \ n/30 . Defective inventory of 1,000 was returned two days later, and the accounts were appropriately adjusted. If the invoice is paid
- Juniper Company uses a perpetual inventory system and the gross method of accounting for purchases. The company purchased $9.750 of merchandise on August 7 with terms 110 n/30. On August 11, it returned $1,500 worth of merchandise. On August 16, it paid t
- Mallette Inc. uses a job-order costing system in which any underapplied or overapplied overhead is closed out to cost of goods sold at the end of the month. The company has provided the following data
- Our company uses a perpetual inventory system. On July 3, we sold merchandise with a cost of $3,000 for $6,500 to a customer on account. The terms of the sale were 2/10, n/30. What account and amount would we credit to record the sales revenue for this tr
- Warden Inc. uses a job-order costing system in which any underapplied or overapplied overhead is closed out to cost of goods sold at the end of the month. The company's cost of goods manufactured for March was $152,000 and its beginning and ending invento
- A company using the perpetual inventory system purchased inventory worth $500,000 on account with credit terms of 3/15, n/45. A defective inventory of $50,000 was returned 3 days later, and the accounts were appropriately adjusted to record the return. If
- A company that uses the net method of recording purchases and a perpetual inventory system purchased $3,700 of merchandise on July 5 with terms 2/10, n/30. On July 7, it returned $850 worth of merchandise. On July 28, it paid the full amount due. The corr
- Starlight Corporation uses a perpetual inventory system. It purchased $3,000 of merchandise on August 2 on account. Credit terms were 1/10, n/30. It returned $250 of the merchandise on August 4. On August 12, it pays the supplier. Which of the following i
- On March 1, 2014, Parnevik Company sold goods to Goosen Inc. for $632,000 in exchange for a 5-year, zero-interest-bearing note in the face amount of $1,065,000. The goods have an inventory cost on Par
- A company sold merchandise with a cost of $215 for $390 on the account. The seller uses the perpetual inventory system. The entry to record the cost of merchandise sold would include __________.
- A company that uses the perpetual inventory system sold goods for $2,500 to a customer on account. The company had purchased the inventory for $500. Which of the following journal entries correctly records the cost of goods sold? A. Cost of Goods Sold 50
- Burghardt Inc. uses a job-order costing system in which any underapplied or overapplied overhead is closed out to cost of goods sold at the end of the month. The company's cost of goods manufactured f
- Cha Company buys merchandise on account from Wirtz Company. The selling price of the goods is $1,110, and the cost of the goods is $730. Both companies use perpetual inventory systems. Journalize the
- A company purchased merchandise inventory at a cost of $8,500 with credit terms 2 10, net 60. If the company borrows $8,330 to pay for the purchase on the last day of the discount period and pays the
- Turner Company uses a perpetual inventory system. July 3 Sold $15,400 of merchandise on account to (Smith LLC), credit terms are 2/10, n/30. Cost of goods is $9,300. July 7 Received a $750 sales return from the customer (Smith LLC). Cost of the goods is
- Radomir Company buys merchandise on account from Lemke Company. The selling price of the goods is $1,112, and the cost of the goods is $775. Both companies use perpetual inventory systems. Journalize
- A company that uses the perpetual inventory system sold goods to a customer on account for $4,000. The cost of the goods sold was $2,000. Which of the following journal entries correctly records this transaction? A. Cost of Goods Sold 4,000 Sales Revenue
- On August 1, Olivera Company sold merchandise in the amount of $4,600 to Wyne, with credit terms of 3/10, n/30. The cost of the items sold is $3,700. Olivera uses the perpetual inventory system. On August 4, Wyne returns some of the merchandise. The selli
- Amy Foods, Inc. uses a perpetual inventory system. At year-end, the inventory account had a balance of $257,000, but a complete year-end physical inventory indicated goods on hand costing only $251,000. How should the company address this issue?
- A company using the periodic inventory system has merchandise inventory costing $175 on hand at the beginning of the period. During the period, merchandise costing $635 is purchased. At year-end, merchandise inventory costing $160 is on hand. What is the
- A company using the perpetual inventory system purchased inventory worth $21,000 on account with terms of 3/10, n/30. Defective inventory of $1,000 was returned two days later, and the accounts were appropriately adjusted. If the invoice is paid within 10
- Your company uses a perpetual inventory system. On July 3, you sold merchandise with a cost of $3,300 for $6,600 to a customer on account. The terms of the sale were 2/10, n/30. What account and amount would you debit to record the sales revenue for this
- Based on the information below, journalize the entries during April 20XX for the Johnson Company and the Hills Company. Both use a perpetual inventory system. April 4 - Johnson Company sells Hills Company on account merchandise costing $200 for $450, term
- A company purchased $11,100 of merchandise on June 15 with terms of 2/10, n/45, and FOB shipping points. The freight charge was $1,050. On June 20, it returned $1,680 of that merchandise. On June 24, it paid the balance owed for the merchandise taking any
- On March 1, 2014, Pamevik Company sold goods to Goosen Inc. for $695,600 in exchange for a 5-year, zero-interest-bearing note in the face amount of $1,070,200. The goods have an inventory cost on Pame
- Journalize the following assuming the use of the perpetual inventory system: June 21: Sold merchandise for cash, $3,200. The cost of the merchandise is $1,540.
- In a perpetual inventory system the Cost of Goods Sold account is used: a. only when a cash sale of merchandise occurs. b. only when a credit sale of merchandise occurs. c. whenever there is a sale of merchandise or a return of merchandise sold. d. on
- A company, using the periodic inventory system, has merchandise inventory costing $210 on hand at the beginning of the period. During the period, merchandise costing $635 is purchased. At year-end, merchandise inventory costing $145 is on hand. The cost o
- A company, using the periodic inventory system, has merchandise inventory costing $175 on hand at the beginning of the period. During the period, merchandise costing $635 is purchased. At year-end, merchandise inventory costing $160 is on hand. The cost o
- A company using the periodic inventory system has merchandise inventory costing $347 on hand at the beginning of a period. During the period, merchandise costing $655 is purchased. At year-end, merchandise inventory costing $107 is on hand. The cost of me
- During the month of June, Ace Incorporated purchased goods from two suppliers. The sequence of events was as follows: (perpetual inventory system) June 3 Purchased goods for $6,900 from Diamond Inc.
- A company begins business in June and uses the periodic method. Its June merchandise purchases are $195,000 on account, FOB shipping point. Merchandise that cost $3,000 is returned for credit. Goods that the company sells for $11,000 and that cost $7,000
- A company uses the perpetual inventory and the gross method. On March 1, it purchased $45,000 of inventory, terms 2/10, n/30. On March 3, such company returned goods that cost $4,500. On March 9, the company paid the supplier. On March 9, the company shou
- On March 1, 2017, Parnevik Company sold goods to Goosen Inc. for $660,000 in exchange for a five-year, zero-interest-bearing note in the face amount of $1,062,937. The goods have an inventory cost on Parnevik's books of $400,000. Prepare the journal entr
- A company had purchased inventory for $96,000. Purchases Returns and Allowances were $2,000 and Freight In was $4,000. If the beginning inventory was $50,000 and the ending inventory was $40,000, the cost of merchandise sold is A) $108,000 B) $88,000
- Rita Company buys merchandise on account from Linus Company. The selling price of the goods is $900 and the cost of the goods sold is $590. Both companies use perpetual inventory systems. Journalize t
- Radomir Company buys merchandise on account from Lernke Company. The selling price of the goods is $780, and the cost of the goods is $470. Both companies use the perpetual inventory systems. Journal
- Under the perpetual inventory system, discounts taken on an invoice by the buyer would be: A) debited to Merchandise Inventory B) credited to Merchandise Inventory C) debited to Cost of Goods Sold D) credited to Cost of Goods Sold
- Bell Company purchased merchandise on account from Office Suppliers for $85,000, with terms of 2/10, n/30. During the discount period, Bell returned some merchandise and paid $73,500 as payment in full. Bell uses a perpetual inventory system. Prepare the
- A company uses the perpetual method for inventory and records purchases at gross. In 20X4, it has total merchandise purchases of $324,000. It returns $19,000 of the merchandise for full credit, receives $7,000 in allowances from its vendors for defective
- DOT ice cream, Inc., purchased inventory for its ice cream shop in August 2009 for $55,000 cash to sell in August and September. The company sold inventory that cost 32,000 in August and the remainder in September. What is the cost of goods sold for Augu
- On March 12, Klein Company, Inc. sold merchandise in the amount of $7,800 to Babson Company, with credit terms of 2/10, n/30. The cost of the items sold is $4,500. Klein uses the perpetual inventory system. The journal entry or entries that Klein will mak
- A company using the perpetual inventory system purchased inventory worth $28,000 on account with terms of 2/10, n/30. Defective inventory of $3,000 was returned 2 days later, and the accounts were appropriately adjusted. If the invoice is paid within 10 d
- A company using the perpetual inventory system purchased inventory worth $25,000 on account with terms of 2/10, n/30. A defective inventory of $2,000 was returned 2 days later and the accounts were appropriately adjusted. If the invoice is paid within 10
- Under a perpetual inventory system, when a shortage is discovered: a. Merchandise Inventory is debited. b. Cost of Merchandise Sold is credited. c. Inventory Shortages is credited. d. Merchandise Inventory is credited.
- Supreme Ice cream Inc., purchased inventory for its ice cream shop in August 2009 for 40,000 in cash to sell in August and September. The company sold inventory that cost 38,000 in August and the rema
- Supreme Ice Cream, Inc., purchased inventory for it ice cream shop in August 2009 for 55,000 in cash to sell in August and September. The company sold inventory that cost 36,000 in August and the rema
- Assume the perpetual inventory method is used. 1) The company purchased $4,900 of merchandise on account under terms 2/10, n/30. 2) The company returned $530 of merchandise to the supplier before payment was made. 3) The liability was paid within the dis
- Slinky Company purchased merchandise on June 10, 2016, at a price of $38,000, subject to credit terms of 3/10, n/30. Slinky uses the net method for recording purchases and uses a perpetual inventory s
- On March 2, Kwang Company sold $956,000 of merchandise to Sensat Company, terms 3/10, n/30. The cost of the merchandise sold was $552,000. Journalize the transaction.
- A company purchased $11,400 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping points. The freight charge, of $1,200, was added to the invoice amount. On June 20, it returned $1,920 of that merchandise. On June 24, it paid the balance ow
- Journalize the following transactions for the Evans Company. Assume the company uses a perpetual inventory system. 11/17 Sold merchandise for $645. The cost of merchandise sold was $375. 11/18 Sold merchandise for $432 and accepted VISA as the form of pay
- Gerish Company buys merchandise on account from Mangus Company. a.) The selling price of the goods is $1,089 and the cost of the goods sold is $622. b.) Both companies use perpetual inventory system
- Cha Company buys merchandise on account from Wirtz Company. The selling price of the goods is $780, and the cost of the goods is $470. Both companies use perpetual inventory systems. Journalize the transaction on the books of both companies.
- Streif Inc., a local retailer, has provided the following data for the month of June: Merchandise inventory, beginning balance $46,000 Merchandise inventory, ending balance $52,000 Sales $260,000 Purc
- Maxi Company made the following merchandise purchases and sales during the month of May: The company uses the Last-in, first-out (LIFO) method and the perpetual system. The operating expenses totaled
- Using the perpetual inventory system, journalize the purchase of merchandise on account costing $5,400 which is expected to be sold for $9,000.
- 4 - Purchased merchandise on account from Winterholt Company at a cost of $65,500, terms 1/15, n/30, FOB shipping point. 7 - Freight charges of $1,720 were paid by the appropriate party on the September 4 purchase of merchandise. What are the entries fo
- Blossom Company buys merchandise on account from Sunland Company. The selling price of the goods is $1,465 and the cost of the goods sold is $685. Both companies use perpetual inventory systems. Jour
- A retailer that uses a perpetual inventory system purchased $8,000 of merchandise on credit. The credit terms were 2/10, n/30, and FOB shipping point. The freight costs were $130. What was the journal entry to record the purchase? A. Merchandise Inventory
- Under the perpetual inventory system, all purchases of merchandise are debited to the account entitled: A. Merchandise Inventory B. Cost of Merchandise Sold C. Cost of Merchandise Available for Sale D. Purchases
- Company used the periodic inventory system for purchase & sales of merchandise. Discount terms for both purchase & sales are, FOB Destination, 2/10, n30 and the gross method is used. 1. Purchased on account $2,500 of merchandise on May 2, 2016. 2. Retur
- Dot .Ice cream Inc. purchased inventory for his ice cream shop in August 2009 for $80,000 cash to sell in August and September. The company sold inventory that cost $33,000 in August and the remainder in September. What is the cost of goods sold for Augus
- Damico Company purchased merchandise on September 10, 2013, at a price of $20,000, subject to credit terms of 2/10, n30. Damico uses the net method for recording purchases and uses a perpetual inventory system. Using the accounting equation format, recor
- Huse Inc., uses a job order costing system in which any underapplied or overapplied overhead is closed to the cost of goods sold at the end of the month. In June, the company completed job J38C which consisted of 21,000 units of one of the company's stand
- Under the perpetual inventory system, in addition to making the entry to record a sales return, a company would: A) debit Merchandise Inventory and credit Cost of Goods Sold. B) make no additional entry until the end of the period. C) debit Cost of Goo
- Assume the perpetual inventory method is used. 1) The company purchased 12,500 dollars of merchandise on account under terms 2/10, n/30. 2) The company returned 1,200 dollars of merchandise to the sup
- Tiger Company completed the following transactions. The annual accounting period ends December 31. Jan. 3 Purchased merchandise on account at a cost of $42,000. (Assume a perpetual inventory system)
- ACME Inc., a local retailer, has provided the following data for the month of September: Merchandise inventory, beginning balance $50,400 Merchandise inventory, ending balance $45,400 Sales $435,20
- ACME Inc. is a merchandising company. Last month the company's cost of goods sold was $79,000. The company's beginning merchandise inventory was $41,000 and its ending merchandise inventory was $20,00
- Mcadams Inc. uses a job-order costing system in which any underapplied or overapplied overhead is closed to cost of goods sold at the end of the month. In April, the company completed job C21F that co
- Alpha Company used the periodic inventory system for the purchase & sales of merchandise. Discount terms for both purchase & sales are, FOB Destination, 2/10, n/30, and the gross method is used. 1. Alpha Company purchased on account $2,700 of merchandise
- Using the perpetual inventory system, journalize the sale of merchandise on account for $1,200 which costs $675.
- Under the perpetual inventory system, all purchases of merchandise are debited to the account a. Merchandise Inventory b. Cost of Merchandise Sold c. Cost of Merchandise Available for Sale d. Purchases
- Alpha Company uses the periodic inventory system for purchase & sales of merchandise. The value of inventory is based on periodic system. On January 1, 2016, beginning inventor consisted of 400 units of widgets costing $10 each. Alpha prepares monthly inc
- Using a perpetual inventory system, the purchase of inventory is recorded with a: a) Debit to Inventory. b) Debit to Cost of Goods Sold. c) Credit to Sales Revenue.
- On September 1, Wilderness Inc. had an inventory of 18 backpacks at a cost of $30 each. The company uses a perpetual inventory system. During September, the following transactions occurred
- Viva Inc. has provided the following information for the year: Cost of Goods Sold $1,261,000 Beginning Balance - Finished Goods Inventory $99,000 Ending Balance - Finished Goods Inventory $85,000 What is the cost of goods sold? a) $184,000 b) $1,275,000 c
- Concord Company buys merchandise on account from Pharoah Company. The selling price of the goods is $790, and the cost of the goods is $470. Both companies use perpetual inventory systems. Journalize
- Vista a Company Inc. had a beginning inventory of 100 units of Product RST at a cost of $8 per unit. During the year, purchases were: Vista Company uses a periodic inventory system. Sales totaled 1, 5
- Inventory Costing: FIFO Filimonov Inc. has the following information related to purchases and sales of one of its inventory items: Assume that the company uses a perpetual inventory system. Required:
- On September 1, Wilderness Inc. had an inventory of 18 backpacks at a cost of $30 each. The company uses a perpetual inventory system. During September, the following transactions occurred: |Sep 4 |Purchased 35 backpacks at $30 each from Back Packs Unlim
- Jackson Company uses a perpetual inventory system. On November 30, it purchased $10,000 of merchandise and it must pay the $200 shipping charges. The credit terms for the merchandise were 2/10, n/30. The company paid for both the merchandise and the shipp
- The following transactions occurred during January 2018: Jan.1 Sold merchandise for cash, $2,900. The cost of the merchandise was $1,400. The company uses the perpetual inventory system. 2 Purchased
- If a company uses a perpetual inventory system, it will maintain all the following accounts except: a. purchases. b. inventory. c. sales. d. cost of goods sold. e. All of the above accounts are used with a perpetual inventory system.
- Galaxy Company sold merchandise costing $2,600 for $4,200 cash. The merchandise was later returned by the customer for a refund. If the perpetual inventory method is used, what effect will the sales return have on the accounting equation? a. Total assets
Explore our homework questions and answers library
Browse
by subject