The beginning inventory at Funky Party Supplies and data on purchases and sales

Question

The beginning inventory at Funky Party Supplies and data on purchases and sales for a three-month period ending March 31, 2016, are as follows

Date

Exhibit 4

Date

Transaction Number of Units Per Unit Total Jan. 1 Inventory 2,500 $64.00 $160,000 10 Purchase 7,600 72.00 547,200 28 Sale 3,700 128.00 473,600 30 Sale 1,400 128.00 179,200 Feb. 5 Sale 500 128.00 64,000 10 Purchase 18,500 74.00 1,369,000 16 Sale 8,900 133.00 1,183,700 28 Sale 8,500 133.00 1,130,500 Mar. 5 Purchase 15,000 75.60 1,134,000 14 Sale 10,000 133.00 1,330,000 25 Purchase 3,300 76.00 250,800 30 Sale 7,650 133.00 1,017,450

Explanation / Answer

Determine the total sales and the total cost of merchandise sold for the period. Journalize the entries in the sales and cost of merchandise 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.

Determine the gross profit from sales for the period.

Determine the ending inventory cost as of March 31, 2016.

Purchases Sales Balance Date Units Cost Total Units Cost Total Units Cost Total Jan. 1 2,500 64 160000 Jan. 10 7,600 72 547200 2,500 64 160000 7,600 72 547200 Jan. 28 2,500 64 160000 6400 72 460800 1,200 72 86400 Jan. 30 1400 72 100800 5000 72 360000 Feb. 5 500 72 36000 4500 72 324000 Feb. 10 18500 74 1369000 4500 72 324000 18500 74 1369000 Feb. 16 4,500 72 324000 0 4,400 74 325600 14,100 74 1043400 Feb. 17 8500 74 629000 5,600 74 414400 Mar. 5 15,000 75.6 1134000 5,600 74 414400 15,000 75.6 1134000 Mar. 14 5,600 74 414400 10,600 75.6 801360 4,400 75.6 332640 Mar. 25 3,300 76 250800 10,600 75.6 801360 3,300 76 250800 Mar. 30 7,650 75.6 578340 2,950 75.6 223020 3,300 76 250800 Totals 44,400 $             33,01,000 40650 $29,87,180 6,250 473820

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