Question: Printer Supply Company sells computer printers and printer supplies. One of its products is a toner cartridge for laser printers. At the beginning of 2009,

Printer Supply Company sells computer printers and printer supplies. One of its products is a toner cartridge for laser printers. At the beginning of 2009, there were 200 cartridges on hand at a cost of $60 each. During 2009, Printer Supply Company purchased 1,400 cartridges at $60 each. After inspection, Printer determined that 10 cartridges were defective and returned them to the supplier. Printer also sold 800 cartridges at $95 each and sold an additional 750 cartridges at $102 each after a midyear selling price increase. Customers returned 15 of the cartridges that were purchased at $102 to Printer for miscellaneous reasons. Assume that Printer Supply Company uses a perpetual inventory system.

Required:

1. Prepare summary journal entries to record the purchases and sales of inventory. Assume that all purchases and sales are on credit but no discounts were offered.

2. What is the cost of inventory, cost of goods sold, and gross profit for 2009?

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1 Purchases during the year were 84000 1400 60 Account and Explanation Debit Credit Merchandise Inventory 84000 Accounts Payable 84000 Made purchase o... View full answer

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