Reference no: EM13504736

Journalizing Transactions in a Perpetual Inventory System

One Price is Nice sells various types of jeans and uses a perpetual inventory system. All jeans, regardless of style, are sold for $35 per pair. Following are selected transactions of the One Price is Nice for April 2009.

April 6 - Purchased 30 pairs of style #256 jeans with terms of 2/10, n/30; the per unit cost was $22.

April 9 - Returned ten pairs of the #256 jeans purchased on April 6 due to fabric laws

April 13 - Sold two pairs of style #321 jeans for cash; the per-unit cost of these jeans was $21

April 16 - Paid amount due to the supplier for jeans purchased on April 6.

April 17 - Purchased 12 pairs of style #157 jeans with terms of 2/10, n/30; the per-unit cost was $18.

April 20 - Sold one pair of #155 jeans on credit; the cost of this pair was $24.

April 21 - A customer returned a pair of style #808 jeans because it was the wrong size; the jeans, which cost $20, were returned to inventory.

April 27 - Sold two pairs of style &101 jeans on credit; the per-unit cost of these jeans was $17.

April 27 - Paid amount due to the supplier for jeans purchased on April 17.

Prepare the journal entries necessary to record these transactions for One Price is Nice.

Inventory Costing Methods

The following schedule summarizes the inventory purchases and sales of Brooks Street Enterprises during January 2009.

Per unit Per Unit

# of Unitscost Selling Price

BI 400 $40

Jan 2 purchase 200 44

Jan 5 sale 300 $80

Jan 9 purchase 200 48

Jan 14 sale350 90

Jan 18 purchase 200 50

Jan 21 sale 15090

Jan 25 purchase 50052

Jan 31 sale450 100

Determine Brook Street's ending inventory, cost of goods sold, and gross profit for January 2009, assuming the company uses a perpetual inventory system and the following inventory costing methods: (1) FIFO, (2) LIFO, and (3) moving-average.