91Ó°ÊÓ

Question:This problem continues the Crystal Clear Cleaning problem begun in Chapter 2 and continued through Chapter 5.

Consider the December transactions for Crystal Clear Cleaning that were presentedin Chapter 5. (Cost data have been removed from the sale transactions.) Crystal Clearuses the perpetual inventory system.

Dec. 2 Purchased 1,000 units of inventory for \(4,000 on account from Sparkle

Company on terms, 5/10, n/20.

5 Purchased 1,200 units of inventory from Borax on account with terms

4/10, n/30. The total invoice was for \)6,000, which included a \(300

freight charge.

7 Returned 300 units of inventory to Sparkle from the December 2

purchase.

9 Paid Borax.

11 Sold 500 units of goods to Happy Maids for \)5,500 on account with

termsn/30.

12 Paid Sparkle.

15 Received 100 units with a sales price of \(1,100 of goods back from

customer Happy Maids.

21 Received payment from Happy Maids, settling the amount due in full.

28 Sold 500 units of goods to Bridget, Inc. on account for \)6,500. Terms

1/15,n/30.

29 Paid cash for utilities of \(550.

30 Paid cash for Sales Commission Expense of \)214.

31 Received payment from Bridget, Inc., less discount.

31 Recorded the following adjusting entries:

a. Physical count of inventory on December 31 showed 800 units of

goods on hand.

b. Depreciation, \(150.

c. Accrued salaries expense of \)2,100.

d. Estimated sales returns of \(1,500, with cost of \)540.

e. Prepared all other adjustments necessary for December (Hint: You willneed to review the adjustment information in Chapter 3 to determinethe remaining adjustments). Assume the cleaning supplies left atDecember 31 are $50.

Requirements

2. Journalize the transactions for December 11th, 28th, and 31st (adjusting entry aonly) using the perpetual inventory record created in Requirement 1.

Step by step solution

01

Step-by-Step-SolutionStep1: Journal entry and adjusting entry

Journal entry is the recording of day-to-day operating, financing, and investing activity into books of accounts. Whereas, adjusting entry is the entry made to adjust the final accounts. Journal entry is made regularly and adjusting entry is made at the end of the period.

02

Making entries

	Journal entry
Date	Description	Debit	Credit
Dec 11	Accounts Receivables	$ 5,500
	Sales revenue		$ 5,500
	Being goods sold on credit
11	Cost of goods sold	2,000
	Merchandise Inventory		2,000
	Being cost of goods sold recorded
28	Accounts Receivables	$ 6,500
	Sales revenue		$ 5,500
	Being goods sold on credit
28	Cost of goods sold	2,300
	Merchandise Inventory		2,300
	Being cost of goods sold recorded
31	Cost of goods sold	1,000
	Merchandise Inventory		1,000
	Being loss of goods on physical count recorded

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