Two different companies, Quick Cleaners and JunkTrader entered into the following inventory transactions during December. Both companies use a perpetual inventory system. December 3 - Quick Cleaners sold inventory on account to JunkTrader for $550,000, terms 3/10, n/30. This inventory originally cost Quick Cleaners $330,000. . December 8 - JunkTrader returned inventory to Quick Cleaners for a credit of $20,000. Quick Cleaners returned this inventory to inventory at its original cost of $12,000. . December 23 - JunkTrader paid Quick Cleaners for the amount owed. Required: Prepare the journal entries to record these transactions on the books of Quick Cleaners using the gross method.

Two different companies, Quick Cleaners and JunkTrader entered into the following inventory transactions during December. Both companies use a perpetual inventory system. December 3 - Quick Cleaners sold inventory on account to JunkTrader for $550,000, terms 3/10, n/30. This inventory originally cost Quick Cleaners $330,000. . December 8 - JunkTrader returned inventory to Quick Cleaners for a credit of $20,000. Quick Cleaners returned this inventory to inventory at its original cost of $12,000. . December 23 - JunkTrader paid Quick Cleaners for the amount owed. Required: Prepare the journal entries to record these transactions on the books of Quick Cleaners using the gross method.

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Description: Two different companies, Quick Cleaners and JunkTrader entered into thefollowing inventory transactions during December. Both companies use aperpetual inventory system.• December 3 - Quick Cleaners sold inventory on account to JunkTraderfor $550,000

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter6: Inventories

Section: Chapter Questions

Problem 1PB: FIFO perpetual inventory The beginning inventory at Dunne Co. and data on purchases and sales for a...

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Concept explainers

Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in the market with the motive of earning profit.

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Question

Two different companies, Quick Cleaners and JunkTrader entered into the
following inventory transactions during December. Both companies use a
perpetual inventory system.
• December 3 - Quick Cleaners sold inventory on account to JunkTrader
for $550,000, terms 3/10, n/30. This inventory originally cost Quick
Cleaners $330,000.
. December 8 - JunkTrader returned inventory to Quick Cleaners for a
credit of $20,000. Quick Cleaners returned this inventory to inventory
at its original cost of $12,000.
December 23 - JunkTrader paid Quick Cleaners for the amount owed.
Required:
Prepare the journal entries to record these transactions on the books of
Quick Cleaners using the gross method.
Use the MSWord link for the table to write your journal entries. After you
have written the journal entries on the table in the MSWord document
provided, type in your name below the table on the document, save the
document and then upload it to this problem in the upload space provided
at the bottom of this box.

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