(1)Beginning inventory, purchases and sales data for tennis rackets are as follows:
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Feb 3
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Inventory
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12 units
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@
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$15
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11
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Purchase
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13 units
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@
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$17
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14
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Sale
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18 units
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21
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Purchase
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9 units
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@
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$20
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25
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Sale
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10 units
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Assuming the business maintains a perpetual inventory system, calculate the cost of merchandise sold and ending inventory under the following assumptions:
a. First-in, first-out
b. Last-in, first-out
(2) Putter Pilot Supplies is a golf and aviation supply store. Putter Pilot uses perpetual inventory. Use a General Journal to journalize the following four transactions during the month of March:
(a) On March 4th Putter purchases inventory for sale from Plane Stuff Wholesalers for $9,750.00 with terms 1/10, n/30.
(b) On March 5th Putter pays Airborne Transfer $65 for freight-in on the March 4th order.
(c) On March 12th Putter buys an additional $12,985 in inventory from Plane Stuff Wholesalers with terms 1/10, n/30.
(d) On March 22nd Putter pays Plane Stuff Wholesalers the balance due.
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General Journal
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GJ Page 63
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Date:
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Account Title
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Post
Ref:
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Debit:
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Credit:
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(3) For each of the following, calculate the cost of inventory reported on the balance sheet.
(a) The total merchandise on hand at the end of the year as determined by taking a physical inventory is $55,000. Of the $55,000, $7,000 is held on consignment.
(b) The total merchandise inventory counted at the end of the year was $65,000. Purchases for $7,000 are in transit under FOB shipping point terms.
(c) The total merchandise inventory counted at the end of the year was $60,000. Purchases for $5,000 are in transit under FOB destination terms.