Question

PT Maju Jaya sells one product. The following information is available for January.

January 1, Inventory 100 units at a price of Rp 12,000 / unit

January 4, Sales of 80 units at a price of Rp 16,000 / unit

January 11, Purchased 150 units at a price of Rp 13,000 / unit

January 13, Sales of 120 units at a price of Rp 17,500 / unit

January 20, Purchased 160 units at a price of Rp 14,000 / unit

January 27, Sales of 100 units at a price of Rp 18,000 / unit

The company uses the FIFO cost flow assumption. All purchases and sales are made on credit.

Requested:

a. Assume the company uses a periodic system. Prepare all required journal entries, including the month-end closing journal for recording cost of goods sold! Physical accounting indicates the ending balance of the inventory for January of 110 units.

b. Calculate gross profit using the periodic system!

Answer 1

a)	Journal
	Sr. No.	Date	Particulars	Debit Amount	Credit Amount
	1	Jan-04	Accounts receivables A/c                   Dr.	12,80,000
			To Sales		12,80,000
			(Being goods sold)
	2	Jan-11	Purchases A/c                                           Dr.	19,50,000
			To Accounts Payable A/c		19,50,000
			(Being goods purchased)
	3	Jan-13	Accounts receivables A/c                   Dr.	21,00,000
			To Sales		21,00,000
			(Being goods sold)
	4	Jan-20	Purchases A/c                                           Dr.	22,40,000
			To Accounts Payable A/c		22,40,000
			(Being goods purchased)
	5	Jan-27	Accounts receivables A/c                   Dr.	18,00,000
			To Sales		18,00,000
			(Being goods sold)
	6		Sales A/c                                                  Dr.	51,80,000
			To Trading A/c		51,80,000
			(Adjustment entry)
	7		Trading A/c                                          Dr.	41,90,000
			To Purchase A/c		41,90,000
			(Adjustment entry)
	8		Trading A/c                                          Dr.	12,00,000
			To Opening Stock		12,00,000
			(Adjustment entry)
	9		Closing Stock A/c                                Dr.	15,40,000
			To Trading A/c		15,40,000

b)	Gross profit = Sales - Cost of good sold
		=51,80,000-38,50,000
		=13,30,000

Working
FIFO Method
Date	Purchases	Cost of Good sold	Inventory on Hand
Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost	Quantity	Unit Cost	Total Cost
Jan-01							100	12,000	12,00,000
Jan-04				80	12,000	9,60,000
Jan-11	150	13,000	19,50,000
Jan-13				20	12,000	2,40,000
				100	13,000	13,00,000
Jan-20	160	14,000	22,40,000
Jan-27				50	13,000	6,50,000
Aug. 28				50	14,000	7,00,000
Totals	310		41,90,000	300		38,50,000	110		15,40,000