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Sunday, August 8, 2010

Valix Finacc vol 1 Problem 7-13

Financial Accounting Volume 1 2008 Valix-Peralta
Chapter 1 Problem 7-13


Requirement a


                 Periodic System                                                             Perpetual System


1. Purchases                               800,000                           1. Merchandise inventory        800,000
        Accounts payable                                 800,000                 Accounts payable                                 800,000

2. Accounts payable                50,000                           2. Accounts payable                   50,000
         Purchase returns                                      50,000                 Merchandise inventory                          50,000

3. Accounts payable              600,000                           3. Accounts payable                  600,000
         Cash                                                          600,000               Cash                                                             600,000

4. Accounts receivable       1,580,000                           4. Accounts receivable                         1,580,000
         Sales                                                        1,580,000               Sales                                                          1,580,000

5. Sales return                               40,000                               Cost of sales                             790,000
         Accounts receivable                             40,000               Merchandise inventory                          790,000

6. Cash                                       1,360,000                           5. Sales return                                 40,000
         Accounts receivable                        1,360,000               Accounts receivable                               40,000

7. Inventory-Dec. 31                   60,000                               Merchandise inventory           20,000
         Income summary                                      60,000               Cost of sales                                                20,000
               (60 x 1,000)
                                                                                                  6. Cash                                        1,360,000
                                                                                                            Accounts receivable                          1,360,000

                                                                                                  7. Inventory shortage                 10,000
                                                                                                            Merchandise inventory                            10,000

                                                                                                      Merchandise inventory per book               70,000
                                                                             Physical count                                                  60,000                                                                                                    Shortage                                                             10,000             

Requirement  b


  Periodic System                                                      Perpetual System


Inventory – January                                              90,000               Cost of sales recorded
Purchases                                     800,000                                              (790,000 – 20,000)                         770,000
Purchase returns                                       (   50,000)        750,000               Inventory shortage                               10,000
Goods available for sale                                                  840,000               Adjusted cost of sales                       780,000
Less: Inventory – December 31                        60,000
Cost of sales                                                         780,000

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