Reference no: EM132626470

The following transactions for Super Tire Company occurred during the month of March 2020:

a. Purchased 500 automobile tires on account at a cost of Rs. 40 each for a total of Rs. 20,000.

b. Purchased 300 truck tires on account at a cost of Rs. 80 each for a total of Rs. 24,000.

c. Returned 12 automobile tires to the supplier because they were defective.

d. Paid for the automobile tires.

e. Paid for half the truck tires

f. Paid the remaining balance owed on the truck tires.

g. Sold on account 400 automobile tires at a price of Rs. 90 each for a total of Rs.36,000.

h. Sold on account 200 truck tires at a price of Rs. 150 each for a total of Rs. 30,000.

i. Accepted return of 7 automobile tires from dissatisfied customers.

Required:

Question i. Prepare journal entries to account for the above transactions assuming a periodic inventory system.

Question ii. Prepare journal entries to account for the above transactions assuming a perpetual inventory system.

Question iii. Assume that inventory levels at the beginning of March (before these transactions) were100 automobile tires that cost Rs. 40 each and 70 truck tires that cost Rs. 80 each. Also, assume that a physical count of inventory at the end of March revealed that 184 automobile tires and 164 truck tires were on hand. Given these inventory amounts, prepare the closing entries to account for inventory and related accounts as of the end of March.