Demonstrate perpetual inventory procedure, Accounting Basics

Assignment Help:

Q. Illustrate perpetual inventory procedure?

Data from Exhibit serves like the basis for some of the entries. You would debit the Merchandise Inventory account to record the enhance in the asset due to purchase costs and transportation-in costs. You would credit Merchandise Inventory to record reduces in the asset brought about by purchase discounts, purchase returns and allowances and cost of goods sold to customers. The balance in the account is the cost of the inventory that must be on hand at any date and this entry records the purchase of 10 units on March 2 in Exhibit.

900_Demonstrate perpetual inventory procedure.png

You would as well record the 10 units sold on the perpetual inventory record in Exhibit. Perpetual inventory procedure needs two journal entries for each sale. One entry is at selling price a debit to Accounts Receivable (or Cash) as well as a credit to Sales. The other entry is at cost a debit to Cost of Goods Sold as well as a credit to Merchandise Inventory. Assume that the 10 units sold on March 10 in Exhibit had a retail price of USD 13 each you would record the following entries.

1929_Demonstrate perpetual inventory procedure1.png


Related Discussions:- Demonstrate perpetual inventory procedure

State the term- liabilities, State the term- Liabilities Current Liabi...

State the term- Liabilities Current Liability is a debt which is due for payment within one year. Long-term liability is one NOT paid in a year. OWNER'S EQUITY Also

Bank for international settlements (bis), Bank for International Settlement...

Bank for International Settlements (BIS) A consortium bank recognized to coordinate the collection and rescheduling of German reparations after World War I, the BIS has surviv

Treatment of fire insurance claim received , journal entry fire insurance c...

journal entry fire insurance claim received for previous year is 50% of its original claim

What is internal control - control of cash, What is Internal control - Co...

What is Internal control - Control of cash Internal control refers to procedures and methods a business uses to protect its assets. Checks are written for all transactio

Accounting standards in brief, Accounting Standards  The flexibili...

Accounting Standards  The flexibilities offered by a choice of accounting treatments distinctly diminish, and even distort the comparability of relevant inform

Contributed capital, what is the contributed capital and how do you figure ...

what is the contributed capital and how do you figure it out?

Final accounts, with help of illustrations,comment on final accounts

with help of illustrations,comment on final accounts

Explain vertical analysis, Q. Explain Vertical analysis? Vertical analy...

Q. Explain Vertical analysis? Vertical analysis demonstrates the percentage that each item in a financial statement is of some significant total such as total assets or sales.

Ledger, ledger is said to be the principal book entry and the transactions ...

ledger is said to be the principal book entry and the transactions can even be directly entered into the ledger account. elaborate on the statement and explain why journal is neces

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd