P6-38 Accounting for inventory using the perpetual inventory systemFIFO

This problem continues the Daniels Consulting situation from Problem P5-45 in Chapter 5. Consider January transactions for Daniels Consulting that were presented in Chapter 5. (Cost data have been removed from the sale transactions.) Daniels use the perpetual inventory system.

Jan. 2 Completed a consulting engagement and received cash of $5,700.

2 Prepaid three months office rent, $2,400.

7 Purchased 50 units software inventory on account, $1,050, plus freight in, $50.

18 Sold 40 software units on account, $2,625.

19.Consulted with a client for a fee of $2,500 on account.

20. Paid employee salaries, $1,885, which includes accrued salaries from December.

21. Paid on account, $1,100.

22. Purchased 185 units software inventory on account, $4,810.

24. Paid utilities, $375.

28. Sold 135 units software for cash, $5,265.

31. Recorded the following adjusting entries:

a. Accrued salaries expense, $775

b. Depreciation on Equipment, $60; Depreciation on Furniture, $50

c. Expiration of prepaid rent, $800

d. Physical count of software inventory, 50 units

Requirements

1. Prepare perpetual inventory records for January for Daniels using the FIFO inventory costing method. ( Note you must caculate the cost of goods sold on the 18th, 28th, and 31st)

2. Journalize the transactions for January 18th, 28th, and 31st (adjusting the entry d only) using the perpetual inventory record created in requirement.