Suppose NEC Sales Co. engaged in the following transactions during June of the current year: June...
Question:
Suppose NEC Sales Co. engaged in the following transactions during June of the current year:
| June 3 | Purchased inventory RM1,600 on credit terms of 2/10, net 30. |
| 6 | Returned 40% of the inventory purchased on June 3. It was defective. |
| 9 | Sold goods for cash, RM1,000 (cost RM550). |
| 11 | Paid the amount owed on account from the purchase of June 3, less the June 6 return. |
| 15 | Purchased goods for RM5,000. Credit terms were 3/15, net 30. |
| 16 | Paid a RM200 freight bill on goods purchased. |
| 18 | Sold inventory for RM2,000 on credit terms of 2/10, n/30 (cost, RM950). |
| 20 | Received returned goods from the customer of June 18 sale RM800 (cost RM480). |
| 25 | Received cash in full settlement of the account from the customer who purchased inventory on June 18, less the return and discount. |
| 28 | Sold goods for cash, RM3,200 (cost RM1,800). |
Prepare the journal entries to record the transactions assuming the company uses a perpetual inventory system.
Recording Inventory Sales and Purchases:
The manner in which inventory sales and purchases are recorded depends on whether the entity uses the periodic or perpetual inventory system. In the perpetual system, the inventory asset account is updated with each transaction.
Answer and Explanation: 1
Become a Study.com member to unlock this answer! Create your account
View this answer
Under the perpetual system, inventory purchases are recorded in the inventory asset account, and each time a sales transaction is recorded, the...
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
Recording Sales Using the Perpetual System
from
Chapter 6 / Lesson 8
11K
Sales can be recorded in two inventory systems: periodic, where inventory is updated in chronological increments, or perpetual, where inventory is updated for each individual sale. Identify the benefits to using these systems and review examples of how each records a business's sales.
Related to this Question
- Suppose Heat Miser Air Conditioner Company engaged in the following transactions during June of the current year: Jun 3 Purchased inventory on credit terms of 1/10 net EOM (end of the month), $1,600. 9 Returned 40% of the inventory purchased on June 3. It
- Four transactions that occurred during June are listed below. a. June 1: Issued common stock to several investors for $73,700. b. June 8: Purchased equipment for $13,800 cash. c. June 15: Made cash sales of $21,400 to customers. d. June 29: Paid a $6,
- A buyer had an inventory of $45,000 on June 1 and a planned EOM stock of $51,000. Planned sales for the department were $39,000 and planned markdowns for the month were $3200. As of June 1, the buyer
- Transactions for the month of June were: Purchases Sales June 1 (balance) 1,000 @ $1.00 June 2 500 @ $5.50 3 2,000 @ 2.00 6 1,000 @ 6.50 Assuming that periodic inventory records are kept in units only, the ending inventory on a LIFO basis, rounded to t
- X Company, a merchandiser, started business on June 1. The following were June transactions: 1. Received $93,000 from a group of investors. 2. Bought $8,986 of merchandise, $3,410 for cash, and $5,576 on account. 3. Sold merchandise for $20,200, of which
- BuyHere Company had the following inventory transactions in June. Purchases Sales June 1 (balance) 1,600 @ $3.20 June 2 1,200 @ 5.50 3 4,400 @ 3.10 6 3,.2000 @ 5.50 7 2,400 @ 3.30 They use a perp
- The following data regarding purchases and sales of a commodity were taken from the related perpetual inventory account : June 1 : Balance 25 units at $60 June 6 : Sale 20 units June 8 : Purchase
- Merchandise was purchased on account of Grant's Distributors on June 12. The purchase price was $5,000, less a 10% trade discount and credit terms of 3/10, n/30. 1. Calculate the net amount to record the invoice, less the 10% trade discount. 2. Calculat
- 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.
- During June, the following changes in inventory item 29 took place. June 1: Balance of 1,400 units at $24 June 14: Purchased 900 units at $36 June 24: Purchased 700 units at $30 June 8: Sold 400 units at $50 June 10: Sold 1,000 units at $40 June 29: Sold
- The June 30, 2021, year-end trial balance for Askew company contained the following information: Account Debit Credit Inventory, 7/1/2020 32,000 Sales revenue 380,000 Sales returns 12,000 Purchases 240,000 Purchase discounts 6,000 Purchase returns 10,000
- Consider the following transactions that occurred in September 2012 for Aquamarines. Sep 4 Purchased inventory on terms 1/15, n/eom, $5,000. 4 Purchased inventory for cash of $1,700. 6 Returned $500 of inventory from September 4 purchase. 8 Sold goods on
- A company purchased $11,800 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping point. The freight charge was $1,400 and was prepaid by the sellers. On June 20, it returned $2,240 of that merchandise. On June 24, it paid the balance owed
- in April, another 2% in May, and another 10% in June. Cost of goods sold is expected to be 64% of sales. What is the budgeted gross profit for June?
- June 1 Inventory 260 $3 $ 780 12 Purchase 520 8 4,160 23 Purchase 390 11 4,290 30 Inventory 130 Compute the cost of the ending inventory and the cost of goods sold under FIFO and LIFO.
- Martin & Sons is a small wholesale distributor of consumer goods. The company generates a gross margin of 27% of sales. Sales are 35% for cash and 65% on credit. Credit sales are collected in the month following sale, and accounts receivable on June 30, 2
- Journalize the following transactions assuming the perpetual inventory system: July 3- Sold merchandise on account $3,750. The cost of the merchandise sold was $2,000; July 5- Issued credit memo for $
- A company purchased $10,200 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping points. The freight charge was $600 and was prepaid by the seller. On June 20, it returned $960 of that merchandise. On June 24, it paid the balance owed for
- A company has inventory of 25 units at a cost of $6 each on June 1. On June 3, it purchased 35 units at $11 each. 27 units are sold on June 5. Using the FIFO perpetual inventory method, what is the cost of the 27 units that were sold? \\ A. $675 B. $178
- A company purchased $10,100 of merchandise on June 15 with terms of 2/10, n/45, and FOB shipping point. The freight charge was $550 and was prepaid by the seller. On June 20, it returned $880 of that merchandise. On June 24, it paid the balance owed for t
- During June, the following changes in inventory item 27 took place: June 1 Balance 1,400 units @ $24 8 Sold 400 units @ $50 14 Purchased 800 units @ $36 10 Sold 1,000 units @ $40 24 Purchased 700 units @ $30 29 Sold 500 units @ $44 Perpetual inventories a
- Assume Nile.com began June with 14 units of inventory that cost a total of $210. During June, Nile.com purchased and sold goods as follows: June 8 - Purchase 42 units at $16 June 14 - Sale 35 units at $32 June 22 - Purchase 28 units at $18 June 27 - S
- Marty's Merchandise has budgeted sales as follows for the second quarter of the year: April $30,000 May $60,000 June $50,000 Cost of goods sold is equal to 70% of sales. Inventory at May 1 is budgeted to be 50,400. Inventory at June 1 is budgeted to be 40
- A June sales forecast projects that 6,000 units are going to be sold at a price of $10.50 per unit. The desired ending inventory of units is 15% higher than the beginning inventory of 1,000 units and each unit is purchased for $8. Total June sales are ant
- Ralwins Company had the following balances and transactions during 2018, from January 1 to December 31: Beginning Merchandise Inventory 200 units at $83 March 10 Sold 100 units June 10 Purchased 60
- Using the chart of accounts provided below and the Excel template provided with this assignment, record the transactions for the new assets purchased in June, 2014. June 2 - Purchased a storage locat
- Sunland Warehouse distributes hardback books to retail stores and extends credit terms of 2/10, and n/30 to all of its customers. During the month of June, the following merchandising transactions occurred. June 1 Purchased books on account for $2,250 (in
- Assuming that perpetual inventory records are kept in dollars, the ending inventory on a LIFO basis is: Purchases Sales June 1 (Balance) 1,500 @ $3 June 2 1,000 @ $5 June 15 4,500 @ $4 June 28 2,000 @ $6 a. $11,000 b. $10,500 c. $11,500 d. $17,000 e.
- During June, the following changes in inventory item 27 took place: June 1 Balance 1,400 units $36 14 Purchased 800 units @ $54 24 Purchased 700 units $45 8 Sold 400 units @ $75 10 Sold 1,000 units @
- The Gannon Company has budgeted sales revenues as follows: June July August Credit sales $27,000 $29,000 $18,000 Cash sales 18,000 51,000 39,000 Total sales $45,000 $80,000 $57,000 Past experience indicates that 60% of the credit sales will be collected i
- Selected transactions of DBA, Inc, which uses the perpetual inventory system, are shown below. June 16 Purchased on account from ABD, $10,000, 1/10, n/30, fob shipping point 16 Paid carrier to have goods delivered from ABD, $400 17 Sold goods on account t
- Plack Company budgeted the following information for 2013: May June July Budgeted purchases $104,000 $110,000 $102,000 - Cost of goods sold is 40% of sales. Accounts payable is used only for inventory acquisitions. - Plack purchases and pays for merchandi
- Assuming that periodic inventory records are kept in dollars, the ending inventory on a FIFO basis is: Purchases Sales June 1 (Balance) 1,500 @ $3 June 2 1,000 @ $5 June 15 4,500 @ $4 June 28 2,000 @ $6 a. $17,000 b. $10,500 c. $11,500 d. $12,000 e. N
- The June 1 inventory of the Kaufman Company had a cost of $8,000 and a retail value of $20,000. During June, merchandise was purchased for $36,000 and marked to sell for $60,000. June sales totaled $4
- Metro Computer Company had the following balances and transactions during 2014: Beginning merchandise inventory - 100 units at $75; March 10 - Sold 50 units; June 10 - Purchased 200 units at $80; Octo
- A company purchased $11,200 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping point. The freight charge, $1,100, was added to the invoice amount. On June 20, it returned $1,760 of that merchandise. On June 24, it paid the balance owed f
- A retail store sold $1,000,000 of merchandise inventory in cash during the month of December. The sales were subject to 0.06% sales tax and due to be paid to the state on January 20. Journalize the transaction to record sales revenue for the month of Dec
- On July 22, a company purchased merchandise inventory at a cost of $5,250 with credit terms 2/10, net 60. If the company borrows money at 12% to pay for the purchase on the last day of the discount period and pays the loan off on the last day of the credi
- The following information revealed the transactions of XYZ Pte Ltd for the month of June: Date Transactions Units Purchased (Sold) Unit Cost June 1 Beginning Inventory 300 $10.00 June 3 Purchase 300 $11.00 June 8 Sale (200) June 16 Purchase 400 $11.50 Ju
- Journalize the following inventory merchandise transactions for the Seller and the Buyer, assuming that both uses the perpetual inventory system. Dec. 1 Seller sold merchandise on account to the buyer
- Caplico Company has prepared the following sales budget: Month Budgeted Sales ; March $400,000 ; April 207,000 ; May 241,000 ; June 248,000 ; Cost of goods sold is budgeted at 40% of sales, and the in
- The Perpetual inventory records of the Park Company indicate the following transactions in the month of June: Units Cost/Unit Inventory, June 1 200 $3.20 Purchases June 3 200 3.50 June 17 250 3.60 June 24 300 3.65 Sales June 6 300 June 21 200 June
- Transactions for the month of June were: Sales June 1 (balance) 1,000 @ $3.00 June 2 500 @ $5.50 3 1,000 @ 4.00 6 1,000 @ 7.50 Assuming that periodic inventory records are kept in units only, cost of goods sold on an average cost basis, rounded to the ne
- A company purchased $10,900 of merchandise on June 15 with terms of 2/10, n/45, and FOB shipping point. The freight charge was $950. On June 20, It returned $1,520 of that merchandise. On June 24, It paid the balance owed for the merchandise taking any di
- A company has inventory of 17 units at a cost of $17 each on June 1. On June 3, it purchased 27 units at $19 each. 21 units are sold on June 5. Using the FIFO periodic inventory method, what is the co
- 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
- The following selected accounts are taken from the ledger of XYX Merchandising on June 30, 2017: Sales P550,000 Sales discount 5% Gross profit P209,000 Operating expenses P150,000 Merchandise inventory, Jan. 1, 2017, P75,000 Merchandise inventory, June 30
- McGrath Co. on June 30, 2011, reported a retained earnings balance of $1,475,000 before closing the books. The books of the company showed the following account balances on June 30, 2011: Sales $2,870,000 Inventory: July 1, 2010 150,000 June 30, 2011 175
- McGrath Co. on June 30, 2008, reported a retained earnings balance of $1,475,000 before closing the books. The books of the company showed the following account balances on June 30, 2008: Sales $2,870,000 Inventory: July 1, 2007 150,000 June 30, 2008 175,
- Production and sales estimates for June are as follows: Estimated inventory (units), June 1 8,000 Desired inventory (units), June 30 9,000 Expected sales volume (units): Area X 3,000 Area Y 4,000 Area Z 5,500 Unit sales price $25 The budgeted total sales
- (FIFO, LIFO, and Average Cost Determination) Latrio Company's record of transactions for the month of June was as follows. Purchases June 1 (balance on hand) 2,000 @ $20.00 2 1,500 @ 20.10 7 600 @ 21.
- Cost Retail June 1 Merchandise Inventory $175,000 $280,000 June 1-30 Purchases (net) 2,352,740 3,797,000 June 1-30 Sales 3,510,000 Amount descriptions for entry: -Estimated cost of merchandise sold
- Instruction Journalize the transactions for the month of June for Kern's Book Warehouse using a per- petual inventory system. P5-2A Renner Hardware Store completed the following merchandising transac
- Operations began May 1. Sales are budgeted to increase as $15,000, $17,000, and $20,000 for the first three months. Ending inventory is 75% of the next month's projected sales. Ending inventory for June is: - $7,500 if the gross profit rate is 50%. - $
- LIFO Perpetual Inventory and sales for a three-month period ending June 30 are as follows: Date Transaction Number of Units Per Unit Total Apr. 3 Inventory 54 $375 $20,250 8 Purchase 108 450 48,600 1
- Askew Company uses a periodic inventory system. The June 30, 2016, year-end trial balance for the company contained the following information: Account Debit Credit Merchandise inventory, 7/1/15 32,300 Sales 383,000 Sales returns 12,300 Purchases 243,000 P
- The following data regarding purchases and sales of a commodity were taken from the related perpetual inventory account: June 1 Balance 25 units at 60$ 6 Sale 20 units 8 Purchase 20 units at 61$ 16 Sale 10 units 20 Purchase 20 units at $62 23 Sale 25 uni
- The merchandise inventory was destroyed by fire on August 19th. The following data were obtained from the accounting records. Jan 1 Merchandise inventory $360,000 Jan 1-Aug 19 Purchases (net) 3,200,000 Sales (net) 5,200,000 Estimated gross profit rate
- If I acquired inventories cost $20,000 and sold on 30 June 2017 for $27,000, and on 30 November 2017 obtained a further $8400 of inventory on credit, how should I account the further inventories (30 Nov) on income statement and balance sheet of 31 Dec 201
- On June 12, 2015, ABC sold five machines to XYZ for $20,000, subject to terms 2/15, n30. ABC uses the net method of accounting for sales discounts. 1. Prepare the journal entry to record the sale. 2. Prepare the journal entry and give the date to record
- ABC company has the following record for inventory: On June 1, beginning inventory was 14 units at $42, a purchase was made June 2 for 4 units at $69, a sale was made on June 7 for 7 units at $111, and a final sale was made on June 13 for 5 units at $111.
- A June sales forecast projects that 10,000 units are going to be sold at a price of $10.00 per unit. The desired ending inventory of units is 12% higher than the beginning inventory of 1,100 units. Merchandise purchases for June are projected to include h
- 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
- ABC can reliably estimate that 20% of the goods sold will be returned within the agreed period of time. However, 25% of the goods are actually returned on January 5, 20x2. How much are the net accounts receivable recognized on the date of sale?
- Brichem Company, which sells electric razors had 260,000 of cost of goods sold during the month of June. The company projects a 5 percent increase in the cost of goods sold during July. The inventory balance as of June 30 is $28,000 and the desired ending
- Based on the following data, determine the cost of merchandise sold for June: Merchandise inventory, June 1 $35,500 Merchandise inventory, June 30 40,500 Purchases 384,000 Purchases returns and allowances 11,000 Purchases discounts 3,000 Freight in 6,000
- Your Corporation uses a LIFO perpetual inventory system. On August 2, 10 units were purchased at $12 per unit. August 18, 15 units were purchased at $14 per unit. On August 29, 12 units were sold. What was the balance in ending inventory after this sale?
- On Saturday, June 30, PK Pool Supplies sold merchandise to John Krock on account. The sales price was $5,300, and the cost of goods sold was $4,200. The sales revenue was recorded immediately, but the entry recording the cost of goods sold was dated Monda
- Tamarisk Corp. discloses the following information for the month of June. June 1 Balance 301 units @ $16 10 Sold 198 units @ $39 11 Purchased 797 units @ $19 15 Sold 497 units @ $41 20 Purchased 49
- Clark's Retail plans inventory levels (at cost) at the end of each month as follows: May: $271,000, June: $226,000, July: $209,000, and August: $241,000. Sales are expected to be June: $449,000, July: $359,000, August: $306,000. Cost of goods sold is 65%
- Production and sales estimates for June are as follows: Estimated inventory (units), June 1 8,000 Desired inventory (units), June 30 9,000 Expected sales volume (units): Area X 4,000 Area Y 10,000 Area Z 6,000 Unit sales price $25 The budgeted total sale
- 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
- Journalize the August transactions for Beartooth Co. The following selected transactions were completed during August between Summit Co. and Beartooth Co.: |Aug.1|Summit Co. sold merchandise on acco
- A June sales forecast projects that 6,000 units are going to be sold at a price of $10.50 per unit. The desired ending inventory of units is 15% higher than the beginning inventory of 1,000 units. total June sales are anticipated to be: A. $63,000 B. $6
- A June sales forecast projects that 2,500 units are going to be sold at a price of $11.00 per unit. The desired ending inventory of units is 10% higher than the beginning inventory of 350 units. Total June sales are anticipated to be: A. 27,500 B. 25,03
- On June 30, Calico Fabrics has the following data pertaining to the retail inventory method. Goods available for sale at cost = $42,476 Goods available for sale at retail = $57,400 Net sales = $37,500 Ending inventory at retail = $19,900 Compute the estim
- Yore Corporation has provided the following data for the month of June. The beginning balance in the finished goods inventory account was $35,000 and the ending balance was $26,000. Sales totaled $220
- Prepare journal entries for the following, assuming the company uses a perpetual inventory method and records purchases at their net amounts. June 1 Purchased merchandise from the Martin Company for $900.00 with the terms of 2/10, net 30. June 2 Returne
- Inventory information for Part 311 of Skysong Corp. discloses the following information for the month of June. June 1 Balance 304 units @ $13 June 10 Sold 205 units @ $30 11 Purchased 804 units @ $15
- Inventory information: Sunland Corp. discloses the following information for the month of June. June 1 Balance 298 units @ $11 June 10 Sold 200 units @ $26 June 11 Purchased 802 units @ $13 June
- Accounting records for High Life Corporation yield the following data for the year ended June 30, 2018 (assuming sales returns are non-existent): Inventory, June 30, 2017 $9,000 Purchases of inventory (on account) 57,000 Sales of inventory - 80% on accoun
- During June, the following changes in inventory item 27 took place: June1 - Balance: 1,400 units@ $24 14 - Purchased: 800 units @ $36 24 - Purchased: 700 units @ $30 8 - Sold: 400 units@ $50 10 -
- Sales in April were $35,000. You forecast that monthly sales will increase 2.0% in May and 2.4% in June. Notebook maintains inventory of $10,000 plus 25% of the sales revenue budgeted for the followin
- Which of the following sales results in a short-term gain/loss? A. A capital asset bought on August 15, 2014 and sold on August 16, 2015. B. A capital asset bought on June 30, 2014 and sold on June 20, 2015. C. A capital asset bought on September 12, 2008
- Bramble Corp. discloses the following information for the month of June. June 1 Balance 304 units @ $17 June 10 Sold 201 units @ $41 June 11 Purchased 804 units @ $21 June 15 Sold 503 units @ $43 June
- Dexter, Inc. is in the process of preparing a Purchases Budget for the upcoming April-June quarter. The company has forecasted total sales revenue as follows: | March | $72,000 | April | $93,000 | May | $102,000 | June | $123,000 Cost of goods sold
- ABC company has the following record for inventory: On June 1, beginning inventory was 14 units @ $42, a purchase was made June 2 for 4 units @ $69, a sale was made on June 7 for 7 units @ $111, and a final sale was made on June 13 for 5 units at $111.
- The following information pertains to the Godfrey Company for the six months ended June 30 of the current year: Merchandise inventory, January 1 $700,000 Purchases 5,000,000 Freight-in 400,000 Net sales 6,000,000 Gross profit is normally 25% of sales. Wha
- Croy Inc. has the following projected sales for the next five months: Month Sales in Units April 3,600 May 3,885 June 4,550 July 4,165 August 3,910 Croy's finished goods inventory policy is to have 60% of the next month's sales on hand at the end of each
- A company had an inventory of 8 units at a cost of $16 each on June 1. On June 2, they purchased 7 units at $17 each. On June 6 they purchased 7 units at $21 each. On June 8, they sold 18 units for $54 each. Using the LIFO perpetual inventory method, what
- Home Hardware reported beginning inventory of 20 shovels, for a total cost of $100. The company had the following transactions during the month: Jan. 2 Sold 4 shovels on account at a selling price of $10 per unit. Jan. 16 Sold 10 shovels on account at a s
- On June 1, 2012, the balance in the Supplies account was $300. During June, supplies costing $710 were purchased. A physical count of supplies at June 30 revealed that there was $290 still on hand.
Explore our homework questions and answers library
Browse
by subject