Required information [ The following information applies to the questions displa
ID: 2337356 • Letter: R
Question
Required information
[The following information applies to the questions displayed below.]
Home Hardware reported beginning inventory of 30 shovels, for a total cost of $270. The company had the following transactions during the month:
1.Sold 5 shovels on account at a selling price of $14 per unit. Record the transaction.
2.Sold 10 shovels on account at a selling price of $14 per unit. Record the transaction.
3.Bought 8 shovels on account at a cost of $9 per unit. Record the transaction.
4.Sold 10 shovels on account at a selling price of $14 per unit. Record the transaction.
5.Bought 10 shovels on account at a cost of $9 per unit. Record the transaction.
6.Record a journal entry that shows all goods initially on hand at the beginning of the period (in the Inventory account) and all goods bought during the period (in the purchases account) as having been sold by the end of the period.
7.Record a journal entry that adjusts the accounting records to show that 22 units of inventory actually are still on hand (and should be recorded in the Inventory account) at the end of the period.
Prepare the journal entries that would be recorded using a periodic inventory system. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)
Explanation / Answer
3
Date Account Debit credit 1 Accounts receivable 70 sales revenue 70 [being shovels sold 5*14] 2 Accounts receivable 140 sales revenue 140 [being shovels sold 5*14]3
purchase 72 Accounts payable [8*9] 72 4 Accounts receivable 140 sales revenue 140 5 Purchase 90 Accounts payable 90 6 cost of goods sold 432 Inventory 270 purchase [72+90] 162 7 Inventory 198 cost of goods sold [22*9] 198Related Questions
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