Instructions

 a. Journalize the December transactions and adjusting entries, assuming Cambridge uses the per￾petual inventory method.

 b. Enter the December 1 balances in the ledger T-accounts and post the December transactions. In ad￾dition to the accounts mentioned above, use the following additional accounts: Cost of Goods Sold,

Depreciation Expense, Salaries and Wages Expense, Salaries and Wages Payable, Sales Revenue,

and Sales Returns and Allowances.

 c. Prepare an adjusted trial balance as of December 31, 2020.

 d. Prepare an income statement for December 2020 and a classified statement of financial position at

December 31, 2020

e. Compute ending inventory and cost of goods sold under FIFO, assuming Cambridge uses the periodic inventory system.

 f. Compute ending inventory and cost of goods sold under average-cost, assuming Cambridge uses

the periodic inventory system.

Transcribed Image Text:

ACR6 On December 1, 2020, Cambridge Printers had the account balances shown below. Debit Credit £ 4,650 3,900 Accumulated Depreciation-Equipment Accounts Payable Share Capital-Ordinary Retained Earnings £ 1,500 3,000 Cash Accounts Receivable Inventory Equipment 1,950* 21,000 20,000 7,000 £31,500 £31,500 *(3,000 x £0.65) The following transactions occurred during December. Dec. 3 Purchased 4,000 units of inventory on account at a cost of £0.72 per unit. Sold 4,400 units of inventory on account for £0.92 per unit. (It sold 3,000 of the £0.65 units and 1,400 of the £0.72.) 7 Granted the December 5 customer £184 credit for 200 units of inventory returned costing £144. These units were returned to inventory. Purchased 2,200 units of inventory for cash at £0.78 each. Sold 2,000 units of inventory on account for £0.95 per unit. (It sold 2,000 of the £0.72 units.) 17 22 Adjustment data: 1. Accrued salaries payable £400. 2. Depreciation £200 per month. ACR6 On December 1, 2020, Cambridge Printers had the account balances shown below. Debit Credit £ 4,650 3,900 Accumulated Depreciation-Equipment Accounts Payable Share Capital-Ordinary Retained Earnings £ 1,500 3,000 Cash Accounts Receivable Inventory Equipment 1,950* 21,000 20,000 7,000 £31,500 £31,500 *(3,000 x £0.65) The following transactions occurred during December. Dec. 3 Purchased 4,000 units of inventory on account at a cost of £0.72 per unit. Sold 4,400 units of inventory on account for £0.92 per unit. (It sold 3,000 of the £0.65 units and 1,400 of the £0.72.) 7 Granted the December 5 customer £184 credit for 200 units of inventory returned costing £144. These units were returned to inventory. Purchased 2,200 units of inventory for cash at £0.78 each. Sold 2,000 units of inventory on account for £0.95 per unit. (It sold 2,000 of the £0.72 units.) 17 22 Adjustment data: 1. Accrued salaries payable £400. 2. Depreciation £200 per month.

Answer rating: 100% (QA)

Answer of Q No a Cambridge Printers Journal Entries for the month of December 2020 Date Descriptions LF Debit Amount Credit Amount 3Dec20 Purchase AC Dr 2880 To Accounts Payable AC 2880 4000 units of ... View the full answer