P6-28A (AVG) Background: Fit Gym began January with merchandise inventory of 78
ID: 2566954 • Letter: P
Question
P6-28A (AVG)
Background: Fit Gym began January with merchandise inventory of 78 crates of vitamins that cost a total of $4,290. Fit Gym uses the perpetual inventory system, accounts for its merchandise using the weighted-average inventory costing method, and estimates returns at the end of each month. Fit Gym's January transactions related to merchandise inventory are included in the Transactions section below.
Assignment: 1) Using the General Journal tab, click Add Transaction to journalize each transaction. Click Post Transaction once you complete the entry, then repeat these steps for each transaction.
2) Click the Reports tab and review the results of recording these transactions on the General Ledger.
3) Click Submit Work when complete.
Transactions: 01/05/2018 Purchased 156 crates of vitamins for $64 each on account. Terms n/30, FOB destination.
01/13/2018 Sold 180 crates of vitamins on account for $100 each. Terms 1/10, n/30. FOB destination. (Determine Cost of Goods Sold and record two separate entries) 01/14/2018 Paid for the vitamins purchased on January 5.
01/15/2018 Paid a $40 freight bill related to the January 13 sale.
01/18/2018 Purchased 114 crates of vitamins on account, $75 each. Terms n/eom, FOB destination. 01/20/2018 Received payment for the sale of vitamins on January 13, less the discount.
1/26/2018 Sold 150 crates of vitamins for $116 each, on account. Terms 1/10, n/30. FOB shipping point. (Determine Cost of Goods Sold and record two separate entries)
01/31/2018 Paid for the vitamins purchased on January 18.
01/31/2018 Fit Gym estimates that customers will return a total of $200 of vitamins with a cost of $75 related to January sales. (Record two separate entries)
Need help finding the weighted average inventory. I need it to be in journal entry form. Not the one where you input the information in the boxes.
Explanation / Answer
Calculations:
Date Account Titles and Explanation Debit Credit 1/5/2018 Inventory (156 x $64) 9984 Accounts payable 9984 (To record purchase of inventory on account) 1/13/2018 Accounts receivable 18000 Sales revenue (180 x $100) 18000 (To record sales on account) Cost of goods sold 10980 Inventory 10980 (To record cost of sales) 1/14/2018 Accounts payable 9984 Cash 9984 (To record payment on account) 1/15/2018 Freight out 40 Cash 40 (To record freight outward paid) 1/18/2018 Inventory (114 x $75) 8550 Accounts payable 8550 (To record purchase of inventory on account) 1/20/2018 Cash 17820 Sales discount ($18000 x 1%) 180 Accounts receivable 18000 (To record collections on account) 1/26/2018 Accounts receivable 17400 Sales revenue (150 x $116) 17400 (To record sales on account) Cost of goods sold 10575 Inventory 10575 (To record cost of sales) 1/31/2018 Accounts payable 8550 Cash 8550 (To record payment on account) 1/31/2018 Sales Returns and Allowances 200 Payable to customer 200 (To record estimated sales returns) Inventory - Right of return 75 Cost of estimated sales returns 75 (To record cost of sales returns estimated)Related Questions
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