You are given the following information for Carla Vista Company. All transactions are settled in cash....

You are given the following information for Carla Vista Company. All transactions are settled in cash. Carla Vista uses a perpetual inventory system and the weighted average cost formula. Increased competition has reduced the price of the product.

Date	Transaction	Units		Unit Price
July 1	Beginning inventory		25	$19
5	Purchase		55	18
8	Sale		(70)	29
15	Purchase		55	17
20	Sale		(55)	26
25	Purchase		10	16

1.Prepare the required journal entries for the month of July for Carla Vista Company.

2.Determine the ending inventory for Carla Vista.

3.

On July 31, Carla Vista Company learns that the product has a net realizable value of $17 per unit. Prepare the journal entry, if required, to recognize the decrease in value of this product. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Account Titles and Explanation	Debit	Credit

4.

What amount should the ending inventory be valued at on the July 31 balance sheet? What amount should the cost of goods sold be valued at on the July income statement? (Round answers to 2 decimal places, e.g. 5,275.50.)

Ending inventory		$
Cost of goods sold		$

Expert Solution

ekkarill92 answered 2 years ago

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