Date Event Quantity Unit cost Amount Dec.1 Beginning inventory 4units $3 $12 Dec
ID: 2460410 • Letter: D
Question
Date
Event
Quantity
Unit cost
Amount
Dec.1
Beginning inventory
4units
$3
$12
Dec.5
Purchase
6units
$5
$30
Dec.8
Sale
(4units)
Dec.17
Purchase
2units
$6
$12
Dec.20
Sale
(3units)
Dec.22
Purchase
1unit
$8
$8
9. If the company uses a physical (periodic) System with Weighted Average costing, ending inventory would be: (round your computation of average cost per unit to 4 demical paces, round your final answer to the nearest penny.)
a. $28.62 b. $33.38 c.$33.40 d. $37.53 e. none of the above
Use the following information for questions 10, 11, and 12.
October 15: Bombay Inc. purchased $100 of inventory on account.
October 20: Bombay returned $30 of this merchandise because it had been damaged in transit.
October 24: Bombay paid $65 for the remaining merchandise, having earned a prompt payment discount of $5
10. To record the purchase on October 15, the journal entries under the perpetual and Periodic systems would be as follows:
Perpetual System
Periodic System
a.purchases 100
accounts payable 100
Inventory 100
Accounts payable 100
b.accounts payable 100
purchases 100
Inventory 100
Purchases 100
c. Inventory 100
Purchases 100
Accounts payable 100
Purchases 100
d. Inventory 100
Accounts payable 100
Purchases 100
Accounts payable 100
None of the above
11. To record the return of merchandise on October 20, the journal entries under the Perperual and Periodic systems would be as follows:
Perpetual System
Periodic System
a.accounts payable 30
Inventory 30
accounts payable 30
Purchase Returns & Allowance 30
b. accounts payable 30
Purchase Returns & Allowance 30
accounts payable 30
Inventory 30
c. Purchase Returns & Allowance 30
accounts payable 30
Inventory 30
accounts payable 30
d. Inventory 30
Accounts payable 30
Purchase Returns & Allowance 30
Accounts payable 30
None of the above
12. To record the payment on October 24, the journal entries under the Perpetual and Periodic systems would be:
Perpetual System
Periodic System
a.Cash 65
accounts payable 65
Cash 65
accounts payable 65
b. Cash 65
Purchase Discounts 5
Accounts payable 70
Cash 65
Inventory 5
Accounts payable 70
c. Accounts payable 70
Purchase Discounts 5
Cash 65
Accounts payable 70
Inventory 5
Cash 65
d. Accounts payable 70
Inventory 5
Cash 65
Accounts payable 70
Purchase Discounts 5
Cash 65
None of the above
Date
Event
Quantity
Unit cost
Amount
Dec.1
Beginning inventory
4units
$3
$12
Dec.5
Purchase
6units
$5
$30
Dec.8
Sale
(4units)
Dec.17
Purchase
2units
$6
$12
Dec.20
Sale
(3units)
Dec.22
Purchase
1unit
$8
$8
Explanation / Answer
Weighted Average Method(Periodic Inventory system ) Answer(a) Question 9) Date Event Total of all Puchases Qunantity 1-Dec Beginning Inventory 12 4 5-Dec Purchases 30 6 17-Dec Purchases 12 2 22-Dec Purchases 8 1 62 13 Weighted average cost 4.7692 closing stock Date Event Quantity Closing balance 1-Dec Beginning Inventory 4 4 5-Dec Purchases 6 10 8-Dec Sales 4 6 17-Dec Purchases 2 8 20-Dec Sales 3 5 22-Dec Purchases 1 6 Closing inventory 28.62 10) Answer(d) October 15,Bombay Inc purchases $100 of inventory on account. Prepectual Method Amount (Dr) Amount(Cr) Periodic Method Amount(Dr) Amount (Cr) Inventory A/c $ 100.00 Purchases A/c $ 100.00 To Accounts Payable $ 100.00 To Accounts Payable $ 100.00 11) Answer (a) To record the return of mercedndise on october 20, Prepectual Method Amount (Dr) Amount(Cr) Periodic Method Amount(Dr) Amount (Cr) Accounts Payable $ 30.00 Accounts Payable $ 30.00 To Inventory $ 30.00 To Purchase return & allowances $ 30.00 12) answer (d) To record the payment on october 24 th, Prepectual Method Amount (Dr) Amount(Cr) Periodic Method Amount(Dr) Amount (Cr) Accounts Payable $ 70.00 Accounts Payable $ 70.00 To Inventory $ 5.00 To Purchase discount $ 5.00 To Cash $ 65.00 To Cash $ 65.00
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