16E_2 Question:聽Golf Unlimited carrie... [FREE SOLUTION]

Chapter 6: 16E_2 (page 362)

Question:Golf Unlimited carries an inventory of putters and other golf clubs. The sales price of each putter is $119. Company records indicate the following for a particular line ofGolf Unlimited鈥檚 putters:
Date Item Quantity Unit Cost
Nov. 1 Balance 24 $ 53
6 Sale 20
8 Purchase 30 70
17 Sale 30
30 Sale 2
Requirements
2. Journalize Golf Unlimited鈥檚 inventory transactions using the FIFO inventory costingmethod. (Assume purchases and sales are made on account.)

Expert verified

The total of journal book matches at $11,520.

	Journal entry
Date	Description	Debit	Credit

Nov 6	Accounts Receivables	$2,380
	Sales Revenue		$2,380
	Being sales made on account

	Cost of goods sold	$1,060
	Inventory		$1,060
	Being cost of goods sold recorded

8	Inventory	$2,100
	Accounts Payable		$2,100
	Being Inventory purchased on account

	Balance c/d	$5,540	$5,540

	Journal entry
Date	Description	Debit	Credit

	Balance c/d	$5,540	$5,540

Nov 17	Accounts Receivables	$3,570
	Sales Revenue		$3,570
	Being sales made on account

	Cost of goods sold	$2,032
	Inventory		$2,032
	Being cost of goods sold recorded

30	Accounts Receivables	$238
	Sales Revenue		$238
	Being sales made on account

	Cost of goods sold	$140
	Inventory		$140
	Being cost of goods sold recorded

	Balance c/d	$11,520	$11,520

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	2019	2018	2017
Net Sales Revenue	\( 220,000	\) 162,000	\( 176,000
Cost of Goods Sold:
Beginning Merchandise Inventory	\)22,000	\(29,000	\)46,000
Net cost of purchase	132,000	90,000	76,000
Cost of goods available for sale	154,000	119,000	122,000
Less: Ending Merchandise Inventory	32,000	22,000	29,000
Cost of goods sold	122,000	97,000	93,000
Gross Profit	98,000	65,000	83,000
Operating Expenses	72,000	38,000	48,000
Net Income	\( 26,000	\) 27,000	$ 35,000