Example #5: Periodic versus perpetual system Julius Corp. began the month of March with 10,000 units...

 

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Example #5: Periodic versus perpetual system Julius Corp. began the month of March with 10,000 units of inventory each priced at $13 a unit. On March 5, the company made a credit purchase for an additional 30,000 units with a gross purchase price of $15 per unit with terms 3/10, n/30, FOB shipping. The units were shipped on March 6 and arrived on March 8 with $0.30 per unit freight paid in cash on arrival. The company settled its payable with the supplier on March 10. Julius Corp. sold 35,000 units on March 14. On March 18, the company made another credit purchase for 15,000 units with a gross purchase price of $14 per unit with terms 2/10, n/30, FOB destination. The units were shipped March 20 and arrived on March 22 with $0.40 per unit freight paid in cash on arrival. On March 27, the company returned 500 defective units, and the company settled its payable with the supplier for the remaining units on April 10. Julius Corp. sold 10,000 units on March 27. On March 29, the company made a final credit purchase of 10,000 units with a gross purchase price of $16 a unit with terms 3/10, n/30. The units are in-transit at the end of the month and sent FOB destination. Assume discount windows begin on the day of the inventory arriving. A physical count of inventory reported $127,500 of inventory remaining at the end of the period (note that this does not necessarily align with the actual purchase and sale data, i.e., there may be loss or spoilage). 1. Record journal entries corresponding to the purchases of units during the month of March. Be sure to date your entries. (A) Assume that the company uses a gross method for cash discount accounting and a periodic system. (B) Assume that the company uses a net method for cash discount accounting and a perpetual system. 10000 (A) Accuma that the Example #5: Periodic versus perpetual system Julius Corp. began the month of March with 10,000 units of inventory each priced at $13 a unit. On March 5, the company made a credit purchase for an additional 30,000 units with a gross purchase price of $15 per unit with terms 3/10, n/30, FOB shipping. The units were shipped on March 6 and arrived on March 8 with $0.30 per unit freight paid in cash on arrival. The company settled its payable with the supplier on March 10. Julius Corp. sold 35,000 units on March 14. On March 18, the company made another credit purchase for 15,000 units with a gross purchase price of $14 per unit with terms 2/10, n/30, FOB destination. The units were shipped March 20 and arrived on March 22 with $0.40 per unit freight paid in cash on arrival. On March 27, the company returned 500 defective units, and the company settled its payable with the supplier for the remaining units on April 10. Julius Corp. sold 10,000 units on March 27. On March 29, the company made a final credit purchase of 10,000 units with a gross purchase price of $16 a unit with terms 3/10, n/30. The units are in-transit at the end of the month and sent FOB destination. Assume discount windows begin on the day of the inventory arriving. A physical count of inventory reported $127,500 of inventory remaining at the end of the period (note that this does not necessarily align with the actual purchase and sale data, i.e., there may be loss or spoilage). 1. Record journal entries corresponding to the purchases of units during the month of March. Be sure to date your entries. (A) Assume that the company uses a gross method for cash discount accounting and a periodic system. (B) Assume that the company uses a net method for cash discount accounting and a perpetual system. 10000 (A) Accuma that the

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