EX 2-4

PERIODIC SYSTEM PERPETUAL SY

Purchases $ 200,000.00 Merchandise Inventory
Cash $ 200,000.00 Cash

Purchases $ 800,000.00 Merchandise Inventory

Accounts Payable $ 800,000.00 Accounts Payable

Freight In $ 20,000.00 Merchandise Inventory

Cash $ 20,000.00 Cash

Accounts Payable $ 5,000.00 Accounts Payable

Purchases Returns $ 5,000.00 Merchandise Inventory

Accounts Payable $ 795,000.00 Accounts Payable

Purchases discounts $ 15,900.00 Merchandise Inventory
Cash $ 779,100.00 Cash

received goods from consignor received goods from consignor

Accounts Receivable $ 680,000.00 Accounts Receivable

Sales $ 680,000.00 Sales

Cost of Goods Sold

Merchandise Inventory

Sales Returns $ 10,000.00 Sales Returns

Accounts Receivable $ 10,000.00 Accounts Receivable

Merchandise Inventory
Cost of Goods Sold

Sales Returns $ 6,000.00 Sales Returns

Accounts Receivable $ 6,000.00 Accounts Receivable

Cost of Goods Sold

Merchandise Inventory

cash $ 6,000.00 cash

Commissions revenue $ 6,000.00 Commissions revenue

Consignment Inventory $ 250,000.00 Consignment Inventory

Inventory $ 250,000.00 Merchandise Inventory

consignee sold goods consignee sold goods

 EX 2-6
PERPETUAL SYSTEM FIFO PERIODIC AND PERPETUAL
Merchandise Inventory $ 200,000.00
Cash $ 200,000.00 Date Transaction
jan. 1 beginning balance
Merchandise Inventory $ 800,000.00 jan 6 purchases
Accounts Payable $ 800,000.00 feb 5 sales @ 24/unit
mar 19 purchases
Merchandise Inventory $ 20,000.00 mar 24 purchases returns
Cash $ 20,000.00 apr 10 sales @ 24.20/unit
jun 22 purchases
Accounts Payable $ 5,000.00 jul 31 sales @ 26.50/unit
Merchandise Inventory $ 5,000.00 aug 4 sales returns @ 26.50/unit
sept 4 sales @ 27/unit
Accounts Payable $ 795,000.00 nov 15 purchases
Merchandise Inventory $ 15,900.00 dec 28 sales @ 30/unit
Cash $ 779,100.00

received goods from consignor

beginning balance
Accounts Receivable $ 680,000.00 net purchases
Sales $ 680,000.00 CGAS
sold items
Cost of Goods Sold $ 544,000.00 ending inv
Merchandise Inventory $ 544,000.00
WEIGHTED AVERAGE PERIODIC
Sales Returns $ 10,000.00
Accounts Receivable $ 10,000.00 Date Transaction
jan. 1 beginning balance
Merchandise Inventory $ 8,000.00 jan 6 purchases
Cost of Goods Sold $ 8,000.00 feb 5 sales @ 24/unit
mar 19 purchases
Sales Returns $ 6,000.00 mar 24 purchases returns
Accounts Receivable $ 6,000.00 apr 10 sales @ 24.20/unit
jun 22 purchases
Cost of Goods Sold $ 4,800.00 jul 31 sales @ 26.50/unit
Merchandise Inventory aug 4 sales returns @ 26.50/unit
sept 4 sales @ 27/unit
$ 6,000.00 nov 15 purchases
Commissions revenue $ 6,000.00 dec 28 sales @ 30/unit

Consignment Inventory $ 250,000.00

Merchandise Inventory $ 250,000.00 UNITS
beginning inv
consignee sold goods net purchases
 CGAS
sold items
ending inv

weighted average
cost of ending inv

WEIGHTED AVERAGE PERPETUAL

Date Transaction
jan. 1 beginning balance
jan 6 purchases
feb 5 sales @ 24/unit
mar 19 purchases
mar 24 purchases returns
apr 10 sales @ 24.20/unit
jun 22 purchases
jul 31 sales @ 26.50/unit
aug 4 sales returns @ 26.50/unit
sept 4 sales @ 27/unit
nov 15 purchases
dec 28 sales @ 30/unit

MCP 2-6
FIFO PERPETUAL

Date Transaction
july 1 beginning balance
july 7 purchases

july 12 sales

july 21 purchases

july 22 sales

july 29 purchases

WEIGHTED AVERAGE PERIODIC

Date Transaction
jul 1 beginning balance
jul 7 purchases
jul 12 sales
jul 21 purchases
jul 22 sales
jul 29 purchases

beg inv
net purchases
CGAS
items sold
ending inv
 PURCHASES SALES BALANCE
Unit Unit Cost Total Cost Unit Unit Cost Total Cost Unit
1,600
600 14.10 8,460.00
2,000 24.00 48,000.00
2,200 14.70 32,340.00
(160) 14.70 (2,352.00)
1,400 24.20 33,880.00
16,800 15.00 252,000.00
3,600 26.50 95,400.00
(40) 26.50 (1,060.00)
7,000 27.00 189,000.00
1,000 16.00 16,000.00
6,200 30.00 186,000.00
20,440 306,448 20,160 551,220
net purchases sold items

1,600 Ending inv Unit Unit Cost Total Cost

20,440 15-Nov 1,000 16.00 16,000.00
22,040 22-Jun 880 15.00 13,200.00
20,160 1,880 29,200.00
1,880

PURCHASES SALES BALANCE

Unit Unit Cost Total Cost Unit Unit Cost Total Cost Unit
1,600
600 14.10 8,460.00
2,000 24.00 48,000.00
2,200 14.70 32,340.00
(160) 14.70 (2,352.00)
1,400 14.70 20,580.00
16,800 15.00 252,000.00
3,600 15.00 54,000.00
(40) 15.00 (600.00)
7,000 15.00 105,000.00
1,000 16.00 16,000.00
6,200 16.00 99,200.00
20,440 306,448 20,160 326,180

VALUES
1,600 beginning inv 22,400
20,440 net purchases 306,448
 22,040 CGAS 328,848
20,160 ending inv 28,051
1,880 COGS 300,797

14.92
28,051

PURCHASES SALES BALANCE

Unit Unit Cost Total Cost Unit Unit Cost Total Cost Unit
1,600
600 14.10 8,460.00 2,200
2,000 14.03 28,060.00 200
2,200 14.70 32,340.00 2,400
(160) 14.70 (2,352.00) 2,240
1,400 14.64 20,496.00 840
16,800 15.00 252,000.00 17,640
3,600 14.98 53,928.00 14,040
(40) 14.98 (599.20) 14,080
7,000 14.98 104,860.00 7,080
1,000 16.00 16,000.00 8,080
6,200 15.11 93,682.00 1,880

PURCHASES SALES BALANCE

Unit Unit Cost Total Cost Unit Unit Cost Total Cost Unit
2,000
3,000 37.20 111,600.00 2,000
3,000
2,000 36.00 72,000.00
1,600 37.20 59,520.00 1,400
4,800 38.00 182,400.00 1,400
4,800
1,400 37.20 52,080.00
2,400 38.00 91,200.00 2,400
1,600 38.60 61,760.00 2,400
1,600
9,400 355,760 7,400 274,800 4,000

PURCHASES SALES BALANCE

Unit Unit Cost Total Cost Unit Unit Cost Total Cost Unit
2,000
3,000 37.20 111,600.00 5,000
3,600 36.72 132,192.00 1,400
 4,800 38.00 182,400.00 6,200
3,800 37.71 143,298.00 2,400
1,600 38.60 61,760.00 4,000
9,400 355,760.00 7,400 275,490

units cost
2,000 72,000.00
9,400 355,760.00 cost per unit
11,400 427,760.00 37.52
7,400 275,490.00
4,000 150,091.23
 EX 2-7

BALANCE inv, end $ 284,700.00

Unit Cost Total Cost
14.00 22,400.00 coats skirts
cost of production $ 32,000.00 $ 16,000.00
selling price $ 30,000.00 $ 22,400.00
cost of completion $ 4,000.00
selling expenses $ 1,500.00 $ 800.00
NRV $ 28,500.00 $ 17,600.00

LCNRV $ 28,500.00 $ 16,000.00

LCNRV $ 44,500.00

BALANCE
Unit Cost Total Cost
14.00 22,400.00
BALANCE
Unit Cost Total Cost
14.00 22,400.00
14.03 30,860.00
14.03 2,800.00
14.64 35,140.00
14.64 32,788.00
14.64 12,292.00
14.98 264,292.00
14.98 210,364.00
14.98 210,963.20
14.98 106,103.20
15.11 122,103.20
15.11 28,421.20

BALANCE
Unit Cost Total Cost
36.00 72,000.00
36.00 72,000.00
37.20 111,600.00

37.20 52,080.00
37.20 52,080.00
38.00 182,400.00

38.00 91,200.00
38.00 91,200.00
38.60 61,760.00
152,960

BALANCE
Unit Cost Total Cost
36.00 72,000.00
36.72 183,600.00
36.72 51,408.00
37.71 233,808.00
37.71 90,510.00
38.07 152,270.00
EX 2-8 EX 2-9
GROSS METHOD
item LCNRV Purchases $ 200,000.00
A $ 87,000.00 Accounts payable
B $ 85,000.00
C $ 111,000.00 Accounts Payable $ 160,000.00
D $ 194,000.00 purchases discount
total $ 477,000.00 cash

inv end $ 502,000.00 Accounts Papayble $ 40,000.00

LCNRV $ 477,000.00 Cash
difference $ 25,000.00

required allowance $ 25,000.00 COST OF GOODS SOLD

allowance bal $ 33,000.00
gain on reversal $ 8,000.00 Inventory beginning $ -
Purchases $ 200,000.00
CGAS $ 200,000.00
purchases discount $ 16,000.00
COGS $ 184,000.00
 NET METHOD
Purchases $ 180,000.00
$ 200,000.00 Accounts Payable $ 180,000.00

Accounts Payable $ 144,000.00

$ 16,000.00 Cash $ 144,000.00
$ 144,000.00

Accounts Payable $ 36,000.00

$ 40,000.00 Purchases discounts lost $ 4,000.00
Cash $ 40,000.00

COST OF GOODS SOLD

Inventory beginning $ -
Purchases $ 180,000.00
CGAS $ 180,000.00
purchases discount $ -
COGS $ 180,000.00
EX 2-10

15-Nov no entry

31-Dec Loss on purchase commitment $ 1,000,000.00

estimated liability on purchase commitment
tor ecord fall of market price

15-Mar Purchases $ 6,400,000.00

Loss on purchase commitment $ 600,000.00
estimated liability on purchase commitment $ 1,000,000.00
Accounts payable
to record purchase with falling market price

15-Mar Purchases $ 8,000,000.00

estimated liability on purchase commitment $ 1,000,000.00
Accounts Payable
gain on purchase commitment
$ 1,000,000.00

$ 8,000,000.00

$ 8,000,000.00
$ 400,000.00
PROBLEM 10-4
PERIODIC PERPETUAL
Merchandise Inventory $ 90,000.00 Merchandise Inventory
Income Summary $ 90,000.00 Income Summary
beg balance

Purchases $ 800,000.00 Merchandise Inventory

Accounts Payable $ 800,000.00 Accounts Payable
purchases

Accounts Payable $ 50,000.00 Accounts Payable

Purchases Returns $ 50,000.00 Merchandise Inventory
returned defective materials

Accounts Payable $ 600,000.00 Accounts Payable

Cash $ 600,000.00 Cash
paid portion of purchases

Accounts Receivable $ 1,580,000.00 Accounts Receivable

Sales $ 1,580,000.00 Sales
sold seat covers

Cost of Goods Sold

Merchandise Inventory

Sales Returns $ 40,000.00 Sales Returns

Accounts Receivable $ 40,000.00 Accounts Receivable
customer returns

Merchandise Inventory
Cost of Goods Sold

Cash $ 1,360,000.00 Cash

Accounts Receivable $ 1,360,000.00 Accounts Receivable
received payment

Inventory Shortage $ 10,000.00 Inventory Shortage

Merchandise Inventory $ 10,000.00 Merchandise Inventory
inventory shortage

Cost of Sales
Inventory Shortage
Income Summary $ 60,000.00
Merchandise Inventory $ 60,000.00
closing entry

COST OF SALES COST OF SALES

beginning inv $ 90,000.00 beginning inv
net purchases net purchases
purchases $ 800,000.00 purchases
purchases returns $ 50,000.00 purchases returns
net purchases $ 750,000.00 net purchases
CGAS $ 840,000.00 CGAS
ending inv $ 60,000.00 ending inv
COGS $ 780,000.00 COGS

PROBLEM 10-6
GROSS METHOD NET METHOD
Purchases $ 4,750,000.00 Purchases
Accounts Payable $ 4,750,000.00 Accounts Payable
terms 2/10

Freight In $ 250,000.00 Freight In

Cash $ 250,000.00 Cash
paid freight

Accounts payable $ 1,650,000.00 Accounts payable

Purchases discounts $ 33,000.00 Cash
Cash $ 1,617,000.00
paid portion of payable w/ discount

Accounts payable $ 2,100,000.00 Accounts payable

Cash $ 2,100,000.00 Purchases discount lost
paid accounts w/out discount Cash

INVENTORY INVENTORY
purchases $ 4,750,000.00 purchases
freight $ 250,000.00 freight
CGAS $ 5,000,000.00 CGAS
sold portion $ 4,000,000.00 sold portion
remaining $ 1,000,000.00 remaining

COST OF SALES COST OF SALES

net purchases net purchases
purchases $ 4,750,000.00 purchases
purchases discounts $ 33,000.00 purchases discounts
net purchases $ 4,717,000.00 net purchases
freight in $ 250,000.00 freight in
CGAS $ 4,967,000.00 CGAS
ending inventory $ 1,000,000.00 ending inventory
COGS $ 3,967,000.00 COGS

PROBLEM 10-7
GROSS METHOD NET METHOD
Merchandise inventory $ 1,000,000.00 Merchandise inventory
Accounts payable $ 1,000,000.00 Accounts payable
purchases 2/10

Merchandise inventory $ 50,000.00 Merchandise inventory

cash $ 50,000.00 cash
paid freight

Accounts Payable $ 800,000.00 Accounts Payable

Merchandise inventory $ 16,000.00 cash
cash $ 784,000.00
paid w/in disc period

Accounts Payable $ 200,000.00 Accounts Payable

Cash $ 200,000.00 purchases discount lost
paid beyond disc period Cash

Cash $ 1,200,000.00 Cash

Sales $ 1,200,000.00 Sales
sold merchandise

Cost of goods sold $ 700,000.00 Cost of goods sold

Merchandise Inventory $ 700,000.00 Merchandise Inventory
sold merchandise

Income Summary $ 300,000.00 Income Summary

Merchandise Inventory $ 300,000.00 Merchandise Inventory
ending inv

Income Summary $ 300,000.00 Income Summary

Cost of sales $ 300,000.00 Cost of sales
ending inv
 PERPETUAL
Merchandise Inventory $ 90,000.00 90
Income Summary $ 90,000.00
beg balance

Merchandise Inventory $ 800,000.00 890

Accounts Payable $ 800,000.00
purchases

Accounts Payable $ 50,000.00 840

Merchandise Inventory $ 50,000.00
returned defective materials

Accounts Payable $ 600,000.00

Cash $ 600,000.00
paid portion of purchases

Accounts Receivable $ 1,580,000.00 50

Sales $ 1,580,000.00
sold seat covers

Cost of Goods Sold $ 790,000.00

Merchandise Inventory $ 790,000.00
sold seat covers

Sales Returns $ 40,000.00 70

Accounts Receivable $ 40,000.00
customer returns

Merchandise Inventory $ 20,000.00

Cost of Goods Sold $ 20,000.00
customer returns

$ 1,360,000.00
Accounts Receivable $ 1,360,000.00
received payment

Inventory Shortage $ 10,000.00

Merchandise Inventory $ 10,000.00
inventory shortage

Cost of Sales $ 10,000.00

Inventory Shortage $ 10,000.00
inventory shortage
COST OF SALES
beginning inv $ 90,000.00
net purchases
purchases $ 800,000.00
purchases returns $ 50,000.00
net purchases $ 750,000.00
$ 840,000.00
ending inv $ 60,000.00
$ 780,000.00

NET METHOD
Purchases $ 4,655,000.00
Accounts Payable $ 4,655,000.00
terms 2/10

Freight In $ 250,000.00
Cash $ 250,000.00
paid freight

Accounts payable $ 1,617,000.00

Cash $ 1,617,000.00
paid portion of payable w/ discount

Accounts payable $ 2,058,000.00

Purchases discount lost $ 42,000.00
Cash $ 2,100,000.00

INVENTORY
purchases $ 4,655,000.00
freight $ 250,000.00
$ 4,905,000.00
sold portion $ 3,924,000.00
remaining $ 981,000.00

COST OF SALES
net purchases
purchases $ 4,655,000.00
purchases discounts $ -
net purchases $ 4,655,000.00
freight in $ 250,000.00
$ 4,905,000.00
ending inventory $ 981,000.00
$ 3,924,000.00

NET METHOD
Merchandise inventory $ 980,000.00
Accounts payable $ 980,000.00
purchases 2/10

Merchandise inventory $ 50,000.00

cash $ 50,000.00
paid freight

Accounts Payable $ 784,000.00

cash $ 784,000.00
paid w/in disc period

Accounts Payable $ 196,000.00

purchases discount lost $ 4,000.00
Cash $ 200,000.00
paid beyond disc period

$ 1,200,000.00
Sales $ 1,200,000.00
sold merchandise

Cost of goods sold $ 686,000.00

Merchandise Inventory $ 686,000.00
sold merchandise

Income Summary $ 294,000.00

Merchandise Inventory $ 294,000.00
ending inv

Income Summary $ 294,000.00

Cost of sales $ 294,000.00
ending inv