Thomas Turnbull, who operates a business as a toy retailer, was concerned about the end-of-year physical stocktake and ‘cut-off’ procedures.

The Inventory Control account balance at 30 June 2015, under the perpetual inventory system, was $77 200. The physical stocktake count, however, revealed the cost of inventory on hand at 30 June 2015 to be only $73 400. Although Thomas expected some inventory shortfall because of breakage and petty theft, he considered this shortfall to be excessive.

Net realisable value for each inventory item held for sale exceeds cost.

In investigating the reason for the inventory ‘shortfall’, Thomas discovered the following:

1.    Goods costing $800 were sold on credit to A. Anderson for $1500 on 26 June 2015 on DDP terms. The goods were still in transit at 30 June 2015. Thomas had recorded the sale on 26 June 2015 and did not include these goods in the physical stocktake.

2.    Thomas included $2200 of goods held on consignment in the physical stocktake.

3.    Goods costing $910 were purchased on credit from Toy Train Trader on 26 June 2015 and received on 28 June 2015. The purchase was unrecorded at 30 June 2015, but the goods were included in the physical stocktake.

4.    Goods costing $400 were purchased on credit from Toy Town Supplies on 23 June 2015 on EXW shipping terms. The goods were delivered to the transport company on 27 June 2015. The purchase was recorded on 27 June 2015 but, as the goods had not yet arrived, Thomas did not include these goods in the physical stocktake.

5.    At 30 June 2015, Thomas had unsold goods costing $3700 out on consignment. These goods were not included in the physical stocktake.

6.    Goods costing $2100 were sold on credit to Kids Corner Playcentre for $3800 on 24 June 2015 on EXW shipping terms. The goods were shipped on 28 June 2015. The sale was unrecorded at 30 June 2015 and Thomas did not include these goods in the physical stocktake.

Required

Prepare any journal entries necessary on 30 June 2015 to correct any errors and to adjust inventory.