Panabee sells computer peripherals. At December 31, 2018, Panabee’s inventory amounted to $520,000. During the first week in January 2019, the company made only one purchase and one sale. These transactions were as follows: Jan. 2 Purchased 30 modems and 70 printers from Sharp. The total cost of these machines was $31,000, terms 5/10, n/60. Jan. 6 Sold 30 different types of products on account to Pace Corporation. The total sales price was $16,000, terms 8/10, n/90. The total cost of these 30 units to CPI was $7,800 (net of the purchase discount). CPI has a full-time accountant and a computer-based accounting system. It records sales at the gross sales price and purchases at net cost and maintains subsidiary ledgers for accounts receivable, inventory, and accounts payable. Prepare journal entries to record the two transactions, assuming that CPI uses a periodic inventory system.
Panabee sells computer peripherals. At December 31, 2018, Panabee’s inventory amounted to $520,000. During the first week in January 2019, the company made only one purchase and one sale. These transactions were as follows: Jan. 2 Purchased 30 modems and 70 printers from Sharp. The total cost of these machines was $31,000, terms 5/10, n/60. Jan. 6 Sold 30 different types of products on account to Pace Corporation. The total sales price was $16,000, terms 8/10, n/90. The total cost of these 30 units to CPI was $7,800 (net of the purchase discount). CPI has a full-time accountant and a computer-based accounting system. It records sales at the gross sales price and purchases at net cost and maintains subsidiary ledgers for accounts receivable, inventory, and accounts payable. Prepare journal entries to record the two transactions, assuming that CPI uses a periodic inventory system.
Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter20: Accounting For Inventory
Section: Chapter Questions
Problem 1MP
Related questions
Question
Panabee sells computer peripherals. At December 31, 2018, Panabee’s inventory amounted to $520,000. During the first week in January 2019, the company made only one purchase and one sale. These transactions were as follows:
Jan. 2 Purchased 30 modems and 70 printers from Sharp. The total cost of these machines was $31,000, terms 5/10, n/60.
Jan. 6 Sold 30 different types of products on account to Pace Corporation. The total sales price was $16,000, terms 8/10, n/90. The total cost of these 30 units to CPI was $7,800 (net of the purchase discount).
CPI has a full-time accountant and a computer-based accounting system. It records sales at the gross sales price and purchases at net cost and maintains subsidiary ledgers for
- Prepare
journal entries to record the two transactions, assuming that CPI uses a periodic inventory system.
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps with 2 images
Knowledge Booster
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.Recommended textbooks for you
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:
9781337679503
Author:
Gilbertson
Publisher:
Cengage
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:
9781337679503
Author:
Gilbertson
Publisher:
Cengage
Intermediate Accounting: Reporting And Analysis
Accounting
ISBN:
9781337788281
Author:
James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:
Cengage Learning
Financial Accounting
Accounting
ISBN:
9781337272124
Author:
Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:
Cengage Learning
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT