Question

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

Jan. 1       Inventory       111   units at $5 each
4       Sale       90   units at $8 each
11       Purchase       159   units at $6 each
13       Sale       130   units at $9 each
20       Purchase       149   units at $7 each
27       Sale       85   units at $11 each

Riverbed uses the FIFO cost flow assumption. All purchases and sales are on account.
      
Assume Riverbed 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 114 units. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date
Account Titles and Explanation
Debit
Credit
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Accounts Receivable
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720
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Sales Revenue
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720
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Purchases
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954
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Accounts Payable
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Entry field with correct answer
954
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Accounts Receivable
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1170
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Entry field with correct answer
Sales Revenue
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Entry field with correct answer
1170
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Entry field with correct answer
Purchases
Entry field with correct answer
1043
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Entry field with correct answer
Accounts Payable
Entry field with correct answer
Entry field with correct answer
1043
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Entry field with correct answer
Accounts Receivable
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935
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Sales Revenue
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935
Jan. 31
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Inventory
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798
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Cost of Goods Sold
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1754
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Purchases
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1997
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Inventory
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555

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Incorrect answer.   Your answer is incorrect. Try again.
      
Compute gross profit using the periodic system.

Gross profit      
$Entry field with incorrect answer
1031

  

Partially correct answer.   Your answer is partially correct. Try again.
      
Assume Riverbed uses a perpetual system. Prepare all necessary journal entries. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date
Account Titles and Explanation
Debit
Credit
Entry field with correct answer
Entry field with correct answer
Accounts Receivable
Entry field with correct answer
720
Entry field with correct answer
Entry field with correct answer
Sales Revenue
Entry field with correct answer
Entry field with correct answer
720
(To record the sale)
Entry field with correct answer
Cost of Goods Sold
Entry field with incorrect answer
360
Entry field with correct answer
Entry field with correct answer
Inventory
Entry field with correct answer
Entry field with incorrect answer
360
(To record the cost of inventory)
Entry field with correct answer
Entry field with correct answer
Inventory
Entry field with correct answer
954
Entry field with correct answer
Entry field with correct answer
Accounts Payable
Entry field with correct answer
Entry field with correct answer
954
Entry field with correct answer
Entry field with correct answer
Accounts Receivable
Entry field with correct answer
1170
Entry field with correct answer
Entry field with correct answer
Sales Revenue
Entry field with correct answer
Entry field with correct answer
1170
(To record the sale)
Entry field with correct answer
Cost of Goods Sold
Entry field with incorrect answer
Entry field with correct answer
Entry field with correct answer
Inventory
Entry field with correct answer
Entry field with incorrect answer
(To record the cost of inventory)
Entry field with correct answer
Entry field with correct answer
Inventory
Entry field with correct answer
1043
Entry field with correct answer
Entry field with correct answer
Accounts Payable
Entry field with correct answer
Entry field with correct answer
1043
Entry field with correct answer
Entry field with correct answer
Accounts Receivable
Entry field with correct answer
935
Entry field with correct answer
Entry field with correct answer
Sales Revenue
Entry field with correct answer
Entry field with correct answer
935
(To record the sale)
Entry field with correct answer
Cost of Goods Sold
Entry field with incorrect answer
805
Entry field with correct answer
Entry field with correct answer
Inventory
Entry field with correct answer
Entry field with incorrect answer
805
(To record the cost of inventory)

  

Incorrect answer.   Your answer is incorrect. Try again.
      
Compute gross profit using the perpetual system.

Gross profit      
$Entry field with incorrect answer

Answer 1

Part A

Date	Account titles and explanation	Debit	Credit
Jan. 4	Accounts Receivable	720
	Sales Revenue (90 X $8)		720
Jan. 11	Purchases ($159X $6)	954
	Accounts Payable		954
Jan. 13	Accounts Receivable	1170
	Sales Revenue (130 X $9)		1170
Jan. 20	Purchases ($149 X $7)	1043
	Accounts Payable		1043
Jan. 27	Accounts Receivable	935
	Sales Revenue (85 X $11)		935
Jan. 31	Inventory ($7 X 114)	798
	Cost of Goods Sold (balancing figure)	1754
	Purchases ($954 + $1,043)		1997
	Inventory (111 X $5)		555

Part B

Sales Revenue ($720 + $1170 + $935)	2825
Cost of goods sold	1754
Gross profit	1071

Part C

Date	Account titles and explanation	Debit	Credit
Jan. 4	Accounts Receivable	720
	Sales Revenue (90 X $8)		720
Jan. 4	Cost of Goods Sold	450
	Inventory (90 X $5)		450
Jan. 11	Inventory	954
	Accounts Payable (159 X $6)		954
Jan. 13	Accounts Receivable	1170
	Sales Revenue (130 X $9)		1170
Jan. 13	Cost of Goods Sold	759
	Inventory ((21*5)+(109*6))		759
Jan. 20	Inventory	1043
	Accounts Payable ($149 X $7)		1043
Jan. 27	Accounts Receivable	935
	Sales Revenue (85 X $11)		935
Jan. 27	Cost of Goods Sold	545
	Inventory ((50*6)+(35*7))		545

Part D

Sales Revenue ($720 + $1170 + $935)	2825
Cost of goods sold (450+759+545)	1754
Gross profit	1071