Question
In: Accounting
The inventory ledger account balance on June 30, 2019, was $15,300, and net realisable value for...
The inventory ledger account balance on June 30, 2019, was $15,300, and net realisable value for each product line exceeded the cost. The cost of inventory on hand June 30, 2019, determined by physical count, however, was only $15,156. In investigating the reasons for the discrepancy, Boodja-Dooga Ltd discovered the following.
- Goods costing $174 were sold for $220 (GST Inclusive) on June 26, 2019, on FOB destination (seller pays shipping) shipping terms. The goods were in transit on June 30, 2019. The sale was recorded on June 26, 2019, and the goods were not included in the physical count.
- Goods costing $198 (GST Inclusive) were ordered on June 24, 2019, on FOB shipping point shipping terms. The goods were delivered to the transport company on June 27, 2019. The purchase was recorded on June 27, 2019, but, as the goods had not yet arrived, the goods were not included in the physical count.
- Goods costing $280 held on consignment for Richmond Ltd were included in the physical count.
Required
Prepare any journal entries required on June 30, 2019, to correct any errors and to adjust the inventory account.
|
Date |
Account |
Post Ref |
Debit |
Credit |
|
2019 |
||||
|
To record reversal of error in recording of sales of item on FOB Destination shipping terms |
||||
|
To record items “sold” back into inventory |
||||
|
To record inventory lost or missing |
||||
Solutions
ekkarill92 answered 3 years agoRelated Solutions
The inventory ledger account balance on June 30, 2019, was $7,650, and net realisable value for...
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was $7,650, and net realisable value for each product line exceeded
the cost. The cost of inventory on hand June 30, 2019, was
determined by physical count, however, it was only $7,578. In
investigating the reasons for the discrepancy, Beyer Ltd discovered
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Account June 30 2020 June 30 2019 $ $ Cash and cash equivalents 95,800 64,000 Debtors...
Account
June 30 2020
June 30 2019
$
$
Cash and cash equivalents
95,800
64,000
Debtors
231,600
157,200
Inventory
96,720
104,400
Plant and equipment
100,000
75,000
Accumulated depreciation – plant and equipment
(40,000)
(29,000)
Total assets
484 120
371,600
Creditors
71,000
74,400
Accrued expenses
30,000
33,000
Long-term loan
100,000
50,000
Capital and reserves
283,120
214,200
Total liabilities and owners equity
484 120
371,600
Sales
440,000
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296,000
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144,000
Operating expenses (including depreciation)
84,000
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Checks
Deposits
Balance
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$
6,500
Deposits during June
$
16,200
22,700
Checks cleared during June
$
16,600
6,100
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40
6,060
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June 1 Balance
6,500
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19,000
June Deposits
18,100
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