Steve's Hardware Store Uses the Perpetual Inventory System.
Steve's Hardware Store uses the perpetual inventory system.The company incurred the following transactions:
a.On November 1,the owner,Steven Moore,purchased 10 snow blowers on account at $1,000 each.Credit terms were 2/10,net 30.
b.On November 2,Steven returned two snow blowers due to damage incurred in shipping.
c.On November 3,the supplier granted Steven an allowance of $100 on the snow blowers because one of the snow blowers was missing an attachment.
d.On November 10,Steven sold three of the snow blowers on account at $1,500 each.The credit terms were 2/10,net 30.
e.On November 12,Steven paid for the snow blowers.
f.On November 13,one customer returned a snow blower because it did not start.
g.On November 30,Steven paid wages of $2,000 for his assistant.
1.Journalize the above transactions for Steve's Hardware Store.Explanations are not required.
An auto dealer uses a perpetual inventory system.The dealer incurred the following transactions during the month of May:
1.On May 1,a dealer purchased 10 vehicles on account at $20,000 each,with credit terms of 2/10,net 30.
2.On May 2,the dealer returned one vehicle due to a product defect.
3.On May 3,the dealer sold 5 vehicles for $25,000 each on account to a local town.The credit terms were 3/10,net 30.
4.On May 9,the dealer paid for the vehicles purchased less the return on May 2.
5.On May 31,the dealer collected one-half of the amount due from the May 3 sale.
6.On May 31,the dealer paid the rent for the next month of $2,500.
Prepare the journal entries for the dealer during the month of May.Explanations are not required.
The choice of an inventory costing method does not impact a company's balance sheet.
The LIFO method assigns the most recent inventory cost to Cost of Goods Sold.