Under the perpetual inventory system, all purchases of merchandise are debited to the account
a. Merchandise Inventory
b. Cost of Merchandise Sold
c. Cost of Merchandise Available for Sale
d. Purchases
Under the perpetual inventory system, all purchases of merchandise are debited to the account
a. Merchandise Inventory
b. Cost of Merchandise Sold
c. Cost of Merchandise Available for Sale
d. Purchases
Related questions
Perpetual Inventory Using FIFO
Beginning inventory, purchases, and sales data for prepaid cellphones for August are as follows:
| Inventory | Purchases | Sales | |||
|---|---|---|---|---|---|
| August 1 | 2,200 units at $20 | August 10 | 1,100 units at $22 | August 12 | 1,540 units |
| August 20 | 990 units at $24 | August 14 | 1,320 units | ||
| August 31 | 660 units |
Assuming that the perpetual inventory system is used, costing bythe FIFO method, determine the cost of the merchandise sold foreach sale and the inventory balance after each sale.
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Given the following information, prepare in good form the costof goods sold section of an income statement for 20x5.
Freight-In | $ 4,000 |
Merchandise Inventory, December 31, 20x4 | 15,000 |
Merchandise Inventory, December 31, 20x5 | 16,000 |
Purchases | 38,000 |
Purchases Returns and Allowances | 1,800 |
ANS:
Merchandise Inventory, December 31, 20x4 | $ | ||
Purchases | $ | ||
Less Purchases Returns and Allowances |
| ||
Net purchases | $ | ||
Freight-in |
| ||
Net cost of purchases |
| ||
Cost of goods available for sale | $ | ||
Less Merchandise Inventory, December 31, 20x5 |
| ||
Cost of Goods Sold | $ |
