Question

Goiter's Delight, Inc., carries a line of titanium putters. Golfer's Delight, Inc., uses the FIFO method and a perpetual inventory system. The sales price oca entory system. The sales price of each putter is $195. Company records indicate the following activity for putters for the month of July.
Date Item Quantity Unit Cost
July 1 Balance 6 $110
7 Purchase 12 $ 112
11 Sale 17
19 Purchase 15 $ 114
28 Sale 12
Requied:
1. Prepare a perpetual inventory record for the putters to determine the amount Golfer's Delight, Inc., should report for ending inventory and cost of goods sold using the FIFO method.
2. Journalize the inventory transactions for Golfer's Delight, Inc., using the FIFO method. Assume all purchases and sales are on account.

Answer 1

Answer:

please find the answer below

Explanation:

1. Purchases Cost of Goods Sold Inventory on Hand

Date Quantity Unit Cost Total Cost Quantity Unit Cost Total cost Quantity Unit Cost Total Cost

01-Jul        6 $110 $660  

          $660

07-Jul 12 $112 $1, 344     6 $110 $660  

       12 $112 $1, 344  

11-Jul    6 $110 $660     $2, 044

   11 $112 $1, 232 $1, 892 1 $112 $112  

          $112

19-Jul 15 $114 $1, 710     1 $112 $112  

       15 $114 $1, 710  

          $1, 822

28-Jul    1 $112 $112  4 $114 $456  

   11 $114 $1, 254 $1, 366    $456

           

Total 27 units  $3, 054 29 units    4 units   $456

           

           

2. Journal Entries        

07-Jul Dr Inventory  $1, 344        

Cr Trade payables $1, 344        

Purchased inventory on account        

           

11-Jul Dr Trade Payables $1, 892        

Cr Inventory $1, 892        

Sold inventory on account        

           

19-Jul Dr Inventory  $1, 710        

Cr Trade payables $1, 710        

Purchased inventory on account        

           

28-Jul Dr Trade Payables $1, 366        

Cr Inventory $1, 366        

Sold inventory on account        

Answer 2

Answer:

Explanation:

Perpetual Inventory Record

Date         Description          Qty           Unit price             Dr                   Cr

July 1        Balance B/f            6                 $110                 $660

July 7        Purchases             12                $112                 $1,344

July 11        Sales                     17                $195                                       $3,315

July 19       Purchases             15                $114                 $1,710

July 28       Sales                     12               $195                                       $2,340

Ending Inventory using FIFO is 4 @ $114 = $456

Cost of goods sold using FIFO = $660+ $1,344+$1,254 = $3,258

Journal Entries

Purchases A/c                                          Dr                       Cr

July 7        Purchases                           $1,344

July 19       Purchases                           $1,710

Sales A/c                                                   Dr                       Cr  

July 11        Sales                                                               $3,315

July 28       Sales                                                              $2,340

Account Receivable a/c                            Dr                       Cr

July 11        Sales                                     $3,315

July 28       Sales                                     $2,340

Account Payable a/c                                   Dr                       Cr

July 7        Purchases                                                           $1,344

July 19       Purchases                                                          $1,710