Horspool Imports is a furniture distributor. The following information is for one item of inventory, kitchen chairs, for the month of February. The store purchased and sold merchandise on account as follows:
Feb. 1 Opening inventory .......................... 50 chairs at $ 50
3 Purchase ............................................ 60 chairs at $ 55
10 Sale ................................................ 100 chairs at $120
22 Purchase ........................................... 90 chairs at $ 60
24 Sale ................................................ 70 chairs at $140
Assume that Horspool Imports uses the FIFO cost method. All sales were made on account. Operating expenses were $14,400, with two-thirds paid in cash and the rest accrued in Accounts Payable.
Required
1. Prepare a perpetual inventory record, at FIFO cost, for this merchandise.
2. Make journal entries to record the company's transactions.