Question

Marigold Company sells one product. Presented below is information for January for Marigold Company.

Jan. 1 Inventory 104 units at $5 each
4 Sale 79 units at $8 each
11 Purchase 145 units at $6 each
13 Sale 115 units at $9 each
20 Purchase 162 units at $6 each
27 Sale 107 units at $10 each
Marigold uses the FIFO cost flow assumption. All purchases and sales are on account.
Assume Marigold uses a periodic system. Prepare all necessary journal entries, including the end-of-month closing entry to record cost of goods sold. A physical count indicates that the ending inventory for January is 110 units. (If no entry is required, select "No entry" for the account titles and enter for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually)

Answer 1

Jan 4

Dr Accounts Receivable 632

Cr Sales Revenue 632

Jan 11

Dr Purchases 870

Cr Accounts payable 870

Jan 13

Dr Accounts Receivable 1,035

Cr Sales Revenue 1,035

Jan 20

Dr Purchases 972

Cr Accounts payable 972

Jan 27

Dr Accounts receivable 1,070

Cr Sales Revenue 1,070

Jan. 31

Dr Inventory $660

Dr Cost of Goods Sold $1,702

Cr Purchases $1,842

Cr Inventory $520

Step-by-step explanation:

Preparation of all the necessary journal entries, including the end-of-month closing entry to record cost of goods sold.

Jan 4

Dr Accounts Receivable 632

Cr Sales Revenue(79*8) 632

(to record Cost of Goods Sold)

Jan 11

Dr Purchases (145*6) 870

Cr Accounts payable 870

( to record the purchase)

Jan 13

Dr Accounts Receivable 1,035

Cr Sales Revenue(115*9) 1,035

(to record the cost of Goods Sold)

Jan 20

Dr Purchases(162*6) 972

Cr Accounts payable 972

( to record the purchase)

Jan 27

Dr Accounts receivable 1,070

Cr Sales Revenue(107*10) 1,070

( to record the cost of Goods Sold)

Preparation of the journal entry assuming the physical count indicates that the ending inventory for January is 110 units

Jan. 31

Dr Inventory $660

($6* 110)

Dr Cost of Goods Sold $1,702

($520+$1,842-$660)

Cr Purchases $1,842

($870 + $972)

Cr Inventory $520

(104* $5)