Reference no: EM132614599

Question - Fly Company uses a perpetual inventory system. Beginning inventory is 2,500 T-shirts at a cost $2.50 per shirt. During the year Fly had the following inventory transactions:

Jan 12 Purchased 500 units @ $2.15 per unit

Feb 18 Sold 1,350 units @ $6.50 per unit

Jul 1 Purchased 1,000 units @ $2.65 per unit

Aug 29 Sold 1,475 units @ $7.50 per unit

Dec 19 Purchased 500 units @ $3.05 per unit

All purchases and sales are on account.

Instructions -

a) Calculate the cost of goods sold and ending inventory using a weighted average. Round per unit amounts to two decimal places.

b) Prepare journal entries to record the February 18 and the August 29 sales. All sales and purchases are made in cash.