Problem 6-6A Record transactions using a perpetual system, prepare a partial income statement, and adjust for the lower of cost and net realizable value (LO6-2, 6-3, 6-4, 6-5, 6-6)

[The following information applies to the questions displayed below.] At the beginning of October, Bowser Co.s inventory consists of 64 units with a cost per unit of $36. The following transactions occur during the month of October

October		4		Purchase 116 units of inventory on account from Waluigi Co. for $50 per unit, terms 2/10, n/30.
October		5		Pay cash for freight charges related to the October 4 purchase, $672.
October		9		Return 20 defective units from the October 4 purchase and receive credit.
October		12		Pay Waluigi Co. in full.
October		15		Sell 146 units of inventory to customers on account, $11,680. [Hint: The cost of units sold from the October 4 purchase includes $50 unit cost plus $7 per unit for freight less $1 per unit for the purchase discount, or $56 per unit.]
October		19		Receive full payment from customers related to the sale on October 15.
October		20		Purchase 86 units of inventory from Waluigi Co. for $56 per unit, terms 3/10, n/30.
October		22		Sell 86 units of inventory to customers for cash, $6,880.

1. Assuming that Bowser Co. uses a FIFO perpetual inventory system to maintain its inventory records, record the transactions. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

2. Suppose by the end of October that the remaining inventory is estimated to have a net realizable value per unit of $30. Record any necessary adjustment for lower of cost and net realizable value. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.)

3. Prepare the top section of the multiple-step income statement through gross profit for the month of October after the adjustment for lower of cost and net realizable value