Journalizing purchase and sale transactions making closing entries preparing financial statements…

Journalizing purchase and sale transactions making closing entries preparing financial statements and computing the gross profit percentage. Shine king cleaning has decided that in addition to providing cleaning services it will sell cleaning products. Shine king uses the perpectual inventory system. During December 2015 shine king completed the following TransactionDateSep. 3Sep. 4Sep. 4Sep. 6Sep. 8Sep. 8Sep. 9Sep. 10Sep. 12Sep. 13Sep. 15Sep. 15Sep. 22Sep. 23Sep. 23Sep. 25Sep. 25Sep. 25Sep. 26Sep. 29Sep. 30Accounts and ExplanationMerchandizing InventoryAccounts Payable- Shallin WholesaleDebitCredit5,0005,000Merchandise InventoryCash80Merchandise InventoryCash1,700Accounts Payable- Shallin WholesaleMerchandise Inventory801,700500500Accounts Receivable- Hermosa CompanySales Revenue6,000Cost of Good SoldMerchandise Inventory2,640Merchandise InventoryAccounts Payable- Thomas Wholesale8,000Accounts Payable- Shallin WholesaleCashMerchandise Inventory4,580CashSales DiscountAccounts recievable- Hermosa Company5,880120Accounts Payable- Thomas WholesaleMerchandise Inventory6,0002,6408,0004,535456,000200200Accounts Recievable- Jordan CompanySales Revenue2,500Costs Of Good SoldMerchandise Inventory2,500Accounts Payable- Thomas WholesaleCash7,8002,5002,5007,800Sales Return and AllowanceAccounts Receivable- Jordan Company400Merchandise InventoryCosts of Goods Sold160400160Accounts Receivable- SmithsonsSales Revenue1,100Costs of Good SoldMerchandise Inventory400Accounts Receivable- SmithsonsCash75Sales Return and AllowanceAccounts Receivable1,10040075100100CashSales DiscountsAccounts Receivable- Smithsons1,05520Cash2,100Accounts Receivable- Jordan Company1,0752,100Available accounts for journal entries:Merchandise InventoryAccounts PayableShallin WholesalersMerchandise InventoryCashMerchandise InventoryCashAccounts PayableShallin WholesalersMerchandise InventoryAccounts ReceivableHermosa CompanySales RevenueCost of Goods SoldMerchandise InventoryMerchandise InventoryAccounts PayableThomas WholesalersAccounts PayableShallin WholesalersCashMerchandise InventoryCashSales DiscountsAccounts ReceivableHermosa CompanyAccounts PayableThomas WholesalersMerchandise InventoryAccounts ReceivableJordan CompanySales RevenueCost of Goods SoldMerchandise InventoryAccounts PayableThomas WholesalersCashSales Returns and AllowanceAccounts ReceivableJordan CompanyMerchandise InventoryCost of Goods SoldAccounts ReceivableSmithsonsSales RevenueCost of Goods SoldMerchandise InventoryAccounts ReceivableSmithsonsCashSales Returns and AllowanceAccounts ReceivableSmithsonsCashSales DiscountsAccounts ReceivableSmithsonsCashAccounts ReceivableJordan CompanyPerpetual Inventory Record: FIFODateQuantityAug. 1382130TotalsPurchasesUnitCostTotal CostQuantityCost of Goods SoldUnitTotal CostCostQuantityInventory on HandUnitTotal CostCostPerpetual Inventory Record: LIFODateQuantityAug. 1382130TotalsPurchasesUnitTotal CostCostQuantityCost of Goods SoldUnitTotal CostCostQuantityInventory on HandUnitTotal CostCostPerpetual Inventory Record: Weighted-AverageDateQuantityPurchasesUnitCostTotal CostCost of Goods SoldUnitQuantityTotal CostCostAug. 1382130TotalsCalculations:Weighted a(a)=Cost of goods available for sale / Number of units availableAfter the Aug. 8 purchase:===(b)After the Aug. 30 purchase:===QuantityInventory on HandUnitTotal CostCostDetermine the company’s cost of goods sold for August using FIFO, LIFO and weighted-average inventory costing methods.Hint: look at the schedules that you just prepared for each method in the cost of goods sold section- the total cost. This is COGS.Compute gross profit for August using FIFO, LIFO, and weighted-average inventory costing methods.Calculations:Sales revenue=Number of units sold × Sales price per unitAug. 3 sale:==Aug. 21 sale:==Total sales revenue=Sales revenue from Aug. 3 sale + Sales revenue from Aug. 21 saleThe sales revenue is the same for FIFO, LIFO and weighted – average==FIFOTotal Sales RevenueCost of Goods SoldGross ProfitLIFOWeightedAveragehint: the total sales revenue will be the same for each section.If the business wanted to maximize gross profit, which method would it select?Perpetual Inventory Record: LIFOPurchasesUnitQuantityCostDateTotal CostCost of Goods SoldUnitQuantityTotal CostCostQuantityJan. 718222831TotalsCalculations:Unit cost of inventory purchased=(a)Total cost / Total number of unitsJan. 7 purchase:===(b)Jan. 22 purchase:==(c)Units adjustment forinventory shrinkage:per physical countper inventory recordadjustment neededInventory on HandUnitTotal CostCostDateJan. 2Accounts and ExplanationDebitCreditAvailable accounts for journal entries:Jan. 2Jan. 7Jan. 18Jan. 19Jan. 20Jan. 21Jan. 22Jan. 24Jan. 28For cost of inventory purchased remember to add freight inCashService RevenuePrepaid RentCashSoftware InventoryAccounts PayableAccounts ReceivableSales RevenueCost of Goods SoldSoftware InventoryAccounts ReceivableService RevenueSalaries PayableSalaries ExpenseCashAccounts PayableCashSoftware InventoryAccounts PayableUtilities ExpenseCashCashSales RevenueCost of Goods SoldSoftware InventoryBal.Jan. 2Jan. 28Cash16,400Jan. 2Jan. 20Jan. 21Jan. 24Jan. 21Accounts Payable4,700Service RevenueBal.Jan. 7Jan. 22Bal.Jan. 2Jan. 19Bal.Bal.Accounts ReceivableBal.1,750Jan. 18Jan. 19Bal.Jan. 20Salaries Payable6850Software InventoryBal.0Jan. 18Jan. 7Jan. 22Jan. 28Bal.Davis, Capital18,16518,165Prepaid Rent0Bal.Bal.Jan. 18Jan. 28Bal.Unearned RevenueOffice Supplies200200Sales RevenueDavis, WithdrawalsBal.Bal.Bal.Jan. 2Cost of Goods Sold700Jan. 18700Bal.Bal.Bal.Jan. 28Bal.Salaries ExpenseBal.Bal.Jan. 20Bal.Utilities Expense0Jan. 24Bal.Bal..Equipment1,8001,800Rent ExpenseAccumulated DepreciationEquipment30Bal.30Bal.Depreciation ExpenseEquipmentFurniture4,2004,200Depreciation ExpenseFurnitureBal.Bal.Bal.Bal.Accumulated DepreciationFurniture70Bal.70Bal.DateJan. 31Jan. 31Jan. 31Jan. 31Accounts and ExplanationDebitCreditAvailable accounts for journal entries:Salaries ExpenseSalaries PayableDepreciation ExpenseEquipmentDepreciation ExpenseFurnitureAccumulated DepreciationEquipmentAccumulated DepreciationFurnitureRent ExpensePrepaid RentCost of Goods SoldSoftware InventoryBal.Jan. 2Jan. 28Cash16,400Jan. 2Jan. 20Jan. 21Jan. 24Accounts PayableJan. 214,700Bal.Jan. 7Jan. 22Bal.Service RevenueSalaries Payable685Sales RevenueJan. 2Jan. 19Bal.Bal.Accounts ReceivableBal.1,750Jan. 18Jan. 19Bal.Jan. 20Software InventoryJan. 7Jan. 22Jan. 18Jan. 28Adj.Bal.Adj.Bal.Unearned Revenue700Bal.700Bal.Bal.Bal.Bal.Office Supplies200200Davis, Capital18,16518,165Prepaid RentJan. 2Bal.Bal.Bal.Adj.Equipment1,8001,800Accumulated DepreciationEquipment30Bal.Adj.Bal.Bal.Bal.Furniture4,2004,200Accumulated DepreciationFurniture70Bal.Adj.Bal.Davis, WithdrawalsBal.0Jan. 18Jan. 28Bal.Cost of Goods SoldJan. 18Jan. 28Adj.Bal.Salaries ExpenseBal.Bal.Jan. 20Adj.Bal.Utilities ExpenseJan. 24Bal.Rent ExpenseAdj.Bal.Depreciation ExpenseEquipmentAdj.Bal.Depreciation ExpenseFurnitureAdj.Bal.DAVIS CONSULTINGAdjusted Trial BalanceJanuary 31, 2015Account TitleBalanceDebitCashAccounts ReceivableSoftware InventoryOffice SuppliesPrepaid RentEquipmentAccumulated DepreciationEquipmentFurnitureAccumulated DepreciationFurnitureAccounts PayableSalaries PayableUnearned RevenueDavis, CapitalService RevenueSales RevenueCost of Goods SoldSalaries ExpenseUtilities ExpenseRent ExpenseDepreciation ExpenseEquipmentDepreciation ExpenseFurnitureTotalCredit

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