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The beginning inventory at Midnight Supplies and data on purchases and sales for a three month period ending March 31 are as follows. Complete the instructions.   Instructions 1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. 2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account and date your journal entry March 31. Refer to the Chart of Accounts for exact wording of account titles. 3. Determine the gross profit from sales for the period.

The beginning inventory at Midnight Supplies and data on purchases and sales for a three month period ending March 31 are as follows. Complete the instructions.   Instructions 1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. 2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account and date your journal entry March 31. Refer to the Chart of Accounts for exact wording of account titles. 3. Determine the gross profit from sales for the period.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The beginning inventory at Midnight Supplies and data on purchases and sales for a three month period ending March 31 are as follows. Complete the instructions.

  Instructions
1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method.
2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account and date your journal entry March 31. Refer to the Chart of Accounts for exact wording of account titles.
3. Determine the gross profit from sales for the period.
4. Determine the ending inventory cost as of March 31.
5. Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower?
FIFO perpetual inventory Instructions Chart of Accounts FIFO Journal Final Questions FIFO 1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column. Journal Date Purchases Cost of Goods Sold Inventory Date Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost 2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account Jan. 1 $ $ and date your journal entry March 31. Refer to the Chart of Accounts for exact wording of account titles. 10 $ 2$ $ $ 10 $ $ PAGE 10 28 JOURNAL 28 $ $ $ ACCOUNTING FOUATION 30 $ $ $ $ DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Feb. 5 $ $ $ $ 10 $ $ 2 10 $ 3 16 2$ 4 16 $ 2$ $ $ 28 $ $ $ Mar. 5 2$ 2$ $ $ $ $ 14 $ 2$ 14 $ $ $ $ 25 2$ 2$ $ 25 $ $ 30 $ $ $ $ 30 $ $ 31 Balances $ Final Questions 3. Determine the gross profit from sales for the period. 24 4. Determine the ending inventory cost as of March 31. 5. Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower? O Lower O Higher %24
Transcribed Image Text:FIFO perpetual inventory Instructions Chart of Accounts FIFO Journal Final Questions FIFO 1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the first-in, first-out method. Under FIFO, if units are in inventory at two different costs, enter the units with the LOWER unit cost first in the Cost of Goods Sold Unit Cost column and in the Inventory Unit Cost column. Journal Date Purchases Cost of Goods Sold Inventory Date Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost Quantity Unit Cost Total Cost 2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. Assume that all sales were on account Jan. 1 $ $ and date your journal entry March 31. Refer to the Chart of Accounts for exact wording of account titles. 10 $ 2$ $ $ 10 $ $ PAGE 10 28 JOURNAL 28 $ $ $ ACCOUNTING FOUATION 30 $ $ $ $ DATE DESCRIPTION POST. REF. DEBIT CREDIT ASSETS LIABILITIES EQUITY 1 Feb. 5 $ $ $ $ 10 $ $ 2 10 $ 3 16 2$ 4 16 $ 2$ $ $ 28 $ $ $ Mar. 5 2$ 2$ $ $ $ $ 14 $ 2$ 14 $ $ $ $ 25 2$ 2$ $ 25 $ $ 30 $ $ $ $ 30 $ $ 31 Balances $ Final Questions 3. Determine the gross profit from sales for the period. 24 4. Determine the ending inventory cost as of March 31. 5. Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower? O Lower O Higher %24
Instructions Chart of Accounts General Ledger The beginning inventory at Midnight Supplies and data on purchases and sales for a three month period ending March 31 are as follows: ASSETS REVENUE Date Transaction Number of Units Per Unit Total 110 Cash 410 Sales 1 Inventory $130,000 Jan. 2,500 $52.00 111 Petty Cash 610 Interest Revenue 10 Purchase 7,800 60.00 468,000 120 Accounts Receivable 28 Sale 3,750 104.00 390,000 131 Notes Receivable EXPENSES 30 Sale 1,200 104.00 124,800 132 Interest Receivable 510 Cost of Goods Sold Feb. Sale 500 104.00 52,000 141 Inventory 515 Credit Card Expense 10 Purchase 17,500 62.00 1,085,000 145 Office Supplies 516 Cash Short and Over 16 Sale 8,600 109.00 937,400 146 Store Supplies 520 Salaries Expense 28 Sale 8,900 109.00 970,100 151 Prepaid Insurance 531 Advertising Expense Mar. 5 Purchase 14,200 63.60 903,120 181 Land 532 Delivery Expense 14 Sale 10,200 109.00 1,111,800 191 Office Equipment 533 Insurance Expense 25 Purchase 3,400 64.00 217,600 192 Accumulated Depreciation-Office Equipment 534 Office Supplies Expense 30 Sale 7,900 109.00 861,100 193 Store Equipment 535 Rent Expense 194 Accumulated Depreciation-Store Equipment 536 Repairs Expense Instructions 537 Selling Expenses 1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the LIABILITIES 538 Store Supplies Expense first-in, first-out method. 2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. 210 Accounts Payable 561 Depreciation Expense-Office Equipment Assume that all sales were on account and date your journal entry March 31. Refer to the Chart of Accounts for exact wording of account titles. 221 Notes Payable 562 Depreciation Expense-Store Equipment 3. Determine the gross profit from sales for the period. 222 Interest Payable 590 Miscellaneous Expense 4. Determine the ending inventory cost as of March 31. 231 Salaries Payable 710 Interest Expense 5. Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower? 241 Sales Tax Payable
Transcribed Image Text:Instructions Chart of Accounts General Ledger The beginning inventory at Midnight Supplies and data on purchases and sales for a three month period ending March 31 are as follows: ASSETS REVENUE Date Transaction Number of Units Per Unit Total 110 Cash 410 Sales 1 Inventory $130,000 Jan. 2,500 $52.00 111 Petty Cash 610 Interest Revenue 10 Purchase 7,800 60.00 468,000 120 Accounts Receivable 28 Sale 3,750 104.00 390,000 131 Notes Receivable EXPENSES 30 Sale 1,200 104.00 124,800 132 Interest Receivable 510 Cost of Goods Sold Feb. Sale 500 104.00 52,000 141 Inventory 515 Credit Card Expense 10 Purchase 17,500 62.00 1,085,000 145 Office Supplies 516 Cash Short and Over 16 Sale 8,600 109.00 937,400 146 Store Supplies 520 Salaries Expense 28 Sale 8,900 109.00 970,100 151 Prepaid Insurance 531 Advertising Expense Mar. 5 Purchase 14,200 63.60 903,120 181 Land 532 Delivery Expense 14 Sale 10,200 109.00 1,111,800 191 Office Equipment 533 Insurance Expense 25 Purchase 3,400 64.00 217,600 192 Accumulated Depreciation-Office Equipment 534 Office Supplies Expense 30 Sale 7,900 109.00 861,100 193 Store Equipment 535 Rent Expense 194 Accumulated Depreciation-Store Equipment 536 Repairs Expense Instructions 537 Selling Expenses 1. Record the inventory, purchases, and cost of goods sold data in a perpetual inventory record similar to the one illustrated in Exhibit 3, using the LIABILITIES 538 Store Supplies Expense first-in, first-out method. 2. Determine the total sales and the total cost of goods sold for the period. Journalize the entries in the sales and cost of goods sold accounts. 210 Accounts Payable 561 Depreciation Expense-Office Equipment Assume that all sales were on account and date your journal entry March 31. Refer to the Chart of Accounts for exact wording of account titles. 221 Notes Payable 562 Depreciation Expense-Store Equipment 3. Determine the gross profit from sales for the period. 222 Interest Payable 590 Miscellaneous Expense 4. Determine the ending inventory cost as of March 31. 231 Salaries Payable 710 Interest Expense 5. Based upon the preceding data, would you expect the ending inventory using the last-in, first-out method to be higher or lower? 241 Sales Tax Payable
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