Coronado Company uses a perpetual inventory system. Its beginning inventory consists of 80 units that cost $54 each. During June, (1) the company purchased 240 units at $54 each on account, (2) returned 10 units for credit, and (3) sold 200 units at $80 each on account. Journalize the June transactions. (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.) No. Account Titles and Explanation Debit Credit (1) enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount (2) enter an account title enter a debit amount enter a credit amount enter an account title enter a debit amount enter a credit amount (3) enter an account title to record sales enter a debit amount enter a credit amount enter an account title to record sales enter a debit amount enter a credit amount (To record sales) enter an account title to record cost of goods sold enter a debit amount enter a credit amount enter an account title to record cost of goods sold enter a debit amount enter a credit amount (To record cost of goods sold)
The Effect Of Prepaid Taxes On Assets And Liabilities
Many businesses estimate tax liability and make payments throughout the year (often quarterly). When a company overestimates its tax liability, this results in the business paying a prepaid tax. Prepaid taxes will be reversed within one year but can result in prepaid assets and liabilities.
Final Accounts
Financial accounting is one of the branches of accounting in which the transactions arising in the business over a particular period are recorded.
Ledger Posting
A ledger is an account that provides information on all the transactions that have taken place during a particular period. It is also known as General Ledger. For example, your bank account statement is a general ledger that gives information about the amount paid/debited or received/ credited from your bank account over some time.
Trial Balance and Final Accounts
In accounting we start with recording transaction with journal entries then we make separate ledger account for each type of transaction. It is very necessary to check and verify that the transaction transferred to ledgers from the journal are accurately recorded or not. Trial balance helps in this. Trial balance helps to check the accuracy of posting the ledger accounts. It helps the accountant to assist in preparing final accounts. It also helps the accountant to check whether all the debits and credits of items are recorded and posted accurately. Like in a balance sheet debit and credit side should be equal, similarly in trial balance debit balance and credit balance should tally.
Adjustment Entries
At the end of every accounting period Adjustment Entries are made in order to adjust the accounts precisely replicate the expenses and revenue of the current period. It is also known as end of period adjustment. It can also be referred as financial reporting that corrects the errors made previously in the accounting period. The basic characteristics of every adjustment entry is that it affects at least one real account and one nominal account.
Coronado Company uses a perpetual inventory system. Its beginning inventory consists of 80 units that cost $54 each. During June, (1) the company purchased 240 units at $54 each on account, (2) returned 10 units for credit, and (3) sold 200 units at $80 each on account.
Journalize the June transactions. (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.)
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No.
|
Account Titles and Explanation
|
Debit
|
Credit
|
|---|---|---|---|
|
(1)
|
enter an account title
|
enter a debit amount
|
enter a credit amount
|
|
enter an account title
|
enter a debit amount
|
enter a credit amount
|
|
|
(2)
|
enter an account title
|
enter a debit amount
|
enter a credit amount
|
|
enter an account title
|
enter a debit amount
|
enter a credit amount
|
|
|
(3)
|
enter an account title to record sales
|
enter a debit amount
|
enter a credit amount
|
|
enter an account title to record sales
|
enter a debit amount
|
enter a credit amount
|
|
|
(To record sales)
|
|||
|
enter an account title to record cost of goods sold
|
enter a debit amount
|
enter a credit amount
|
|
|
enter an account title to record cost of goods sold
|
enter a debit amount
|
enter a credit amount
|
|
|
(To record cost of goods sold)
|
Inventory:
Inventory refers to the unit of goods that are purchased or produced to sell. They are accounted for in the books of accounted under two systems, Periodic Inventory System and Perpetual Inventory Systems.
Perpetual Inventory System:
Perpetual Inventory is the system where the inventory is being changed perpetually. When there is a production, the inventory account is affected directly instead of the Purchase account. Here, there is no need to calculate the cost of goods sold account at the end of the accounting period, as with each sale, the Cost of Goods Sold Account is updated.
Therefore, the accounting treatment under the perpetual inventory system is by allocating all the purchases directly to the inventory account. And, when the sales are made, two journal entries are recorded, the first one where the sales revenue is recorded, and the other where the inventory is reduced by charging it to the cost of goods sold. Similarly, if any expense is incurred related to the inventory, then also it is charged to the Inventory account.
Now, let us look into the transactions and journalize these transactions as required.
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