Question

1. Perpetual inventory under the weighted-average method. Sembach Learning has 10 books in inventory on February 1, 2019 with a unit cost of $25 per book. During the month of February, the following transactions occurred:

   1. February 5th, 15 books were purchased on account for $30 per book.

   2. February 15th, 5 books were sold on account. The sales price was $50 per book.

   3. February 26th, 25 books were purchased on account for $35 per book.

   4. February 28th, 15 books were sold on account. The sales price was $50 per book.

      1. Prepare the Perpetual Inventory Record (round all numbers to the nearest full dollar amount)

      2. Identify the cost of goods sold for all books sold during February

      3. Identify the cost of ending inventory.

      4. Journalize the appropriate journal entries for each transaction in February to

         include explanations.

Answer 1

For i. , ii & iii

Perpetual Inventory Record

	Purchase	Purchase	Purchase	sale	sale	sale	closing	closing	closing
	Number	Unit Cost	Total	Number	Unit Cost	Total	Number	Unit Cost	Total
Opening							10	25.00	250.00
February 5th	15	30.00	450.00				25	28.00	700.00
February 15th				5	28.00	140.00	20	28.00	560.00
february 26th	25	35.00	875.00				45	31.89	1,435.00
february 28th				15	31.89	478.33	30	31.89	956.67
Total			1,325.00			618.33

cost of goods sold for all books sold during February = $618.33

cost of ending inventory = $956.67

journal entries for each transaction in February

Date	Accounts Title & Explanations	Debit	Credit
February 5th	Inventory	450.00
	Cash		450.00
	(To record Purchase)
February 15th	Cash	250.00
	Cost of good sold	140.00
	Revenue (sales)		250.00
	Inventory		140.00
	(to record sale)
February 26th	Inventory	875.00
	Cash		875.00
	(To record Purchase)
February 28th	Cash	750.00
	Cost of good sold	478.33
	Revenue (sales)		750.00
	Inventory		478.33
	(to record sale)