Idaho Inc. is a wholesale company selling special parts for the automotive industry. The company uses FIFO
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Question:
Idaho Inc. is a wholesale company selling special parts for the automotive industry. The company uses FIFO and a perpetual inventory system. Its inventory records for part SA-123 show the following transactions for the month of May 2014:
Date | Transaction | Units | Unit | Units | Unit |
| | Purchased | Cost | Sold | Selling |
| | | | | Price |
May 1 | Balance | 120 | $7.00 | | |
May 10 | Purchase | 500 | $7.20 | | |
May 15 | Sale | | | (100) | $12.40 |
May 20 | Purchase | 100 | $7.35 | | |
May 21 | Sale | | | (150) | $12.50 |
May 23 | Purchase | 250 | $7.40 | | |
Instructions
Assuming Idaho makes all sales and purchases of inventory on account, prepare the journal entries for each of the above listed transactions.
Now assume Idaho uses the average cost method, prepare the journal entries.
Related Book For
Horngrens Financial and Managerial Accounting The Financial Chapters
ISBN: 978-0134486857
6th edition
Authors: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura
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