Question

This exercise continues the Lydon’s Yard Care, Inc., exercise begun in Chapter 1. Consider the May transactions for Lydon’s Yard Care that were presented in Chapter 4. (Cost data has been removed from the sale transactions.)
May 2 Completed lawn service and received cash of $400.
5 Purchased 120 plants on account for inventory, $307, plus freight-in of $5. Freight-in was added to invoice by seller. Credit terms were n/30.
15 Sold 30 plants on account, $300.
17 Consulted with a client on landscaping design for a fee of $150 on account.
20 Purchased 110 plants on account for inventory, $374.
21 Paid on account, $1,300.
25 Sold 120 plants for cash, $840.
31 Recorded the following adjusting entries:
Accrued salaries for the month of May equal $200
Depreciation on equipment $25
Physical count of plant inventory, 75 plants

Refer to the T-accounts for Lydon’s Yard Care, Inc., from the Continuing Exercise in Chapter 3. Use the ending balances in T-accounts at April 30.

Requirements
1. Prepare perpetual inventory records for Plant Inventory for May for Lydon’s Yard Care, Inc., using the FIFO method.
2. Journalize and post the May transactions using the perpetual inventory record created in Requirement 1. Omit explanations. Key all items by date. Compute each account balance, and denote the balance as Bal.
3. Journalize and post the adjusting entries. Denote each adjusting amount as Adj. Compute each account’s ending balance and denote the balance as Bal.
4. Journalize and post-closing entries. Denote each closing amount as Clo. Compute each account’s ending balance and denote the balance as Bal. Prove the equality of debits and credits by preparing a post-closing trial balance.



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  • CreatedApril 29, 2014
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