R&J Electronics sell a variety of gadgets including tablets. The business uses a perpetual inventory system and the FIFO method to account for inventory and began the third quarter of 2015 with merchandise inventory of 10 “PIXI3G 7" tablets at a total cost of $134,200. During the quarter, the company completed the following transactions. July 8 Purchased 38 tablets at a total cost of $528,200. The sales for July were 18 tablets which yielded total sales revenue of $332,640. July 31 Owing to an increased demand for this product, 30 tablets were purchased on account at a cost of $13,905 per unit. In addition R&J paid $350 in cash on each tablet to have the inventory shipped from the vendor's warehouse to R&J's warehouse. August 12 6 of the tablets purchased on August 12 were returned to the supplier, as they were defective. August 27 During the month 44 tablets were sold at a price of $19,960 each. (10 of these units sold were on account to a long standing customer of the business) August 31 September 4 A customer, to whom 8 tablets were sold during the first business day of August, returned 4 of the units, as they were not of the brand ordered. September 10 In preparation for the new school year, Fuller purchased 35 tablets at a cost of $15,500 each; these were subject to a trade discount of 2% each. September 30 32 tablets were sold during September at a unit selling price of $22,275. September 30 An actual count of inventory was carried out which revealed that there were 20 units of the merchandise in the store room. Unless otherwise stated, assume that all purchases are on account and all sales are for cash. Required: Prepare a perpetual inventory record for the merchandise, to determine the company's Cost of goods sold for the quarter and the value of ending inventory i) Given that selling & distribution and administrative costs for the quarter were $67,240 and$150, 190 respectively, prepare an income statement for R&J Electronics for the quarter ended September 30, 2015. ii) State the journal entries necessary to record the transactions on August 12 and August 31, assuming the company uses a: - Perpetual inventory system - Periodic inventory system iii)

R&J Electronics sell a variety of gadgets including tablets. The business uses a perpetual inventory system and the FIFO method to account for inventory and began the third quarter of 2015 with merchandise inventory of 10 “PIXI3G 7" tablets at a total cost of $134,200. During the quarter, the company completed the following transactions. July 8 Purchased 38 tablets at a total cost of $528,200. The sales for July were 18 tablets which yielded total sales revenue of $332,640. July 31 Owing to an increased demand for this product, 30 tablets were purchased on account at a cost of $13,905 per unit. In addition R&J paid $350 in cash on each tablet to have the inventory shipped from the vendor's warehouse to R&J's warehouse. August 12 6 of the tablets purchased on August 12 were returned to the supplier, as they were defective. August 27 During the month 44 tablets were sold at a price of $19,960 each. (10 of these units sold were on account to a long standing customer of the business) August 31 September 4 A customer, to whom 8 tablets were sold during the first business day of August, returned 4 of the units, as they were not of the brand ordered. September 10 In preparation for the new school year, Fuller purchased 35 tablets at a cost of $15,500 each; these were subject to a trade discount of 2% each. September 30 32 tablets were sold during September at a unit selling price of $22,275. September 30 An actual count of inventory was carried out which revealed that there were 20 units of the merchandise in the store room. Unless otherwise stated, assume that all purchases are on account and all sales are for cash. Required: Prepare a perpetual inventory record for the merchandise, to determine the company's Cost of goods sold for the quarter and the value of ending inventory i) Given that selling & distribution and administrative costs for the quarter were $67,240 and$150, 190 respectively, prepare an income statement for R&J Electronics for the quarter ended September 30, 2015. ii) State the journal entries necessary to record the transactions on August 12 and August 31, assuming the company uses a: - Perpetual inventory system - Periodic inventory system iii)

Financial Accounting

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter6: Accounting For Merchandising Businesses

Section: Chapter Questions

Problem 1COP: Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account...

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Transcribed Image Text:R&J Electronics sell a variety of gadgets including tablets. The business uses a perpetual inventory system and the FIFO method to account for inventory and began the third quarter of 2015 with merchandise inventory of 10 “PIXI3G 7" tablets at a total cost of $134,200. During the quarter, the company completed the following transactions. July 8 Purchased 38 tablets at a total cost of $528,200. The sales for July were 18 tablets which yielded total sales revenue of $332,640. July 31 Owing to an increased demand for this product, 30 tablets were purchased on account at a cost of $13,905 per unit. In addition R&J paid $350 in cash on each tablet to have the inventory shipped from the vendor's warehouse to R&J's August 12 warehouse. 6 of the tablets purchased on August 12 were returned to the supplier, as they were defective. August 27 During the month 44 tablets were sold at a price of $19,960 each. (10 of these units sold were on account to a long standing customer of the business) August 31 A customer, to whom 8 tablets were sold during the first business day of August, returned 4 of the units, as they were not of the brand ordered. September 4 September 10 In preparation for the new school year, Fuller purchased 35 tablets at a cost of $15,500 each; these were subject to a trade discount of 2% each. September 30 32 tablets were sold during September at a unit selling price of $22,275. An actual count of inventory was carried out which revealed that there were 20 units of the merchandise in the store room. September 30 Unless otherwise stated, assume that all purchases are on account and all sales are for cash. Required: Prepare a perpetual inventory record for the merchandise, to determine the company's Cost of goods sold for the quarter and the value of ending inventory i) Given that selling & distribution and administrative costs for the quarter were $67,240 and$150, 190 respectively, prepare an income statement for R&J Electronics for the quarter ended September 30, 2015. ii) State the journal entries necessary to record the transactions on August 12 and August 31, assuming the company uses a: - Perpetual inventory system - Periodic inventory system iii)

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