Classique Designs sells a variety of merchandise, including school shoes for girls. The business began the last quarter of 2013 with 30 pairs of the “Aerosoles” brand at a total cost of $54,000. The following transactions, relating to the “Aerosoles” brand were completed during the quarter: October 3 Purchased 45 pairs of shoes at a cost of $1,900 each. October 15 Sold 55 pairs to Casually Elegant Ltd at a unit price of $2,780 October 26 Purchased 70 pairs at a cost of $2,400 each but these were subject to a trade discount of 5%. November 10 Sold 60 pairs to Best City Store which yielded total sales revenue of $192,000. November 14 Owing to an increased demand for this brand, the manager of Classique purchased 80 additional pairs of the “Aerosole” brand at a unit cost of $2,500, but additionally there was freight charge of $100 on each pair. November 24 Sold 60 pairs of shoes to Big Buy Company at a price of $3,600 each. November 30 A physical stock count on that date revealed that there were 42 pairs of the “Aerosoles” brand in the warehouse. December 4 Purchased 75 pairs of shoes at a total cost of $213,750. December 15 5 pairs of the shoes purchased on December 4 were returned to the supplier as they were of the wrong description. December 30 Sold 70 pairs to Regal Ltd. at a unit selling price of $4,400. All purchases were on account and received on the dates stated and Classique Designs uses the FIFO method to account for inventory. Required:  1. You are told that 15 of the units sold on November 24, 2013 were on account. State the journal entries necessary to record the transactions on November 14 and November 24, assuming the business uses the:   Perpetual inventory system.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question

Classique Designs sells a variety of merchandise, including school shoes for girls. The business began the last quarter of 2013 with 30 pairs of the “Aerosoles” brand at a total cost of $54,000. The following transactions, relating to the “Aerosoles” brand were completed during the quarter:

October 3

Purchased 45 pairs of shoes at a cost of $1,900 each.

October 15

Sold 55 pairs to Casually Elegant Ltd at a unit price of $2,780

October 26

Purchased 70 pairs at a cost of $2,400 each but these were subject to a trade discount of 5%.

November 10

Sold 60 pairs to Best City Store which yielded total sales revenue of $192,000.

November 14

Owing to an increased demand for this brand, the manager of Classique purchased 80 additional pairs of the “Aerosole” brand at a unit cost of $2,500, but additionally there was freight charge of $100 on each pair.

November 24

Sold 60 pairs of shoes to Big Buy Company at a price of $3,600 each.

November 30

A physical stock count on that date revealed that there were 42 pairs of the “Aerosoles” brand in the warehouse.

December 4

Purchased 75 pairs of shoes at a total cost of $213,750.

December 15

5 pairs of the shoes purchased on December 4 were returned to the supplier as they were of the wrong description.

December 30

Sold 70 pairs to Regal Ltd. at a unit selling price of $4,400.

All purchases were on account and received on the dates stated and Classique Designs uses the FIFO method to account for inventory.

Required: 

1. You are told that 15 of the units sold on November 24, 2013 were on account. State the journal entries necessary to record the transactions on November 14 and November 24, assuming the business uses the:   Perpetual inventory system.

 

Expert Solution
steps

Step by step

Solved in 3 steps with 2 images

Blurred answer
Knowledge Booster
Accounting for Guarantees and Warranties
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education