Question

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

Jan. 1		Inventory		101	units at $4 each
4		Sale		80	units at $8 each
11		Purchase		144	units at $6 each
13		Sale		111	units at $9 each
20		Purchase		156	units at $7 each
27		Sale		100	units at $11 each

Crane uses the FIFO cost flow assumption. All purchases and sales are on account.

Assume Crane 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
choose a transaction date                                                                      Jan. 1Jan. 4Jan. 11Jan. 13Jan. 20Jan. 27Jan. 31	enter an account title to record the sale	enter a debit amount	enter a credit amount
	enter an account title to record the sale	enter a debit amount	enter a credit amount
	(To record the sale)
	enter an account title to record the cost of inventory	enter a debit amount	enter a credit amount
	enter an account title to record the cost of inventory	enter a debit amount	enter a credit amount
	(To record the cost of inventory)
choose a transaction date                                                                      Jan. 1Jan. 4Jan. 11Jan. 13Jan. 20Jan. 27Jan. 31	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date                                                                      Jan. 1Jan. 4Jan. 11Jan. 13Jan. 20Jan. 27Jan. 31	enter an account title to record the sale	enter a debit amount	enter a credit amount
	enter an account title to record the sale	enter a debit amount	enter a credit amount
	(To record the sale)
	enter an account title to record the cost of inventory	enter a debit amount	enter a credit amount
	enter an account title to record the cost of inventory	enter a debit amount	enter a credit amount
	(To record the cost of inventory)
choose a transaction date                                                                      Jan. 1Jan. 4Jan. 11Jan. 13Jan. 20Jan. 27Jan. 31	enter an account title	enter a debit amount	enter a credit amount
	enter an account title	enter a debit amount	enter a credit amount
choose a transaction date                                                                      Jan. 1Jan. 4Jan. 11Jan. 13Jan. 20Jan. 27Jan. 31	enter an account title to record the sale	enter a debit amount	enter a credit amount
	enter an account title to record the sale	enter a debit amount	enter a credit amount
	(To record the sale)
	enter an account title to record the cost of inventory	enter a debit amount	enter a credit amount
	enter an account title to record the cost of inventory	enter a debit amount	enter a credit amount
	(To record the cost of inventory)

eTextbook and Media

List of Accounts

Compute gross profit using the perpetual system.

Gross profit

$enter gross profit in dollars

Answer 1

				Schedule
				Perpetual FIFO
				For the Month Ended January 31
	Purchases			Cost of Goods Sold			Inventory
Date	Quantity	Unit Cost ($)	Total Cost ($)	Quantity	Unit Cost ($)	Total Cost ($)	Quantity	Unit Cost ($)	Total Cost ($)
Jan-01							101	4	404
Jan-04				80	4	320	21	4	84
Jan-11	144	6	864				144	6	864
Jan-13				21	4	84
				90	6	540	54	6	324
Jan-20	156	7	1,092				156	7	1,092
Jan-27				54	6	324
				46	7	322	110	7	770
Jounal Entries
					Debit	Credit
Jan-04	Accounts Receivable				640
	Sales Revenue					640
	( to record the sales )
	Cost of Goods Sold				320
	Inventory					320
	( to record the cost of inventory )
Jan-11	Inventory				864
	Accounts Payable					864
Jan-13	Accounts Receivable				999
	Sales Revenue					999
	( to record the sales )
	Cost of Goods Sold				624
	Inventory					624
	( to record the cost of inventory )
Jan-20	Inventory				1,092
	Accounts Payable					1092
Jan-27	Accounts Receivable				1100
	Sales Revenue					1100
	( to record the sales )
	Cost of Goods Sold				646
	Inventory					646
	( to record the cost of inventory )
2	Gross Profit = Sales - Cost of Goods Sold
	Sales = $640 + $999 + $1,100
	= $ 2,739
	Cost of Goods sold
	= $ 320 + $ 624 + $ 646
	= $ 1,590
	Gross Profit = $ 2739 - $ 1590
		= $ 1149