posted by Ronnie .
I need help to journalize these transactions for accounting. Samantha purchased inventory costing 125,000 and sold 70% of the goods for 162,500 all purchases and sales were on account She later collected 25% of the accounts receivable
Which is the perpetual inventory system inventory, revenues and expenses on financial statements, report gross profits on the appropriate statement.
This is a business problem. Please say that in your subject line so we Physics and History teachers do not waste time.
closing inventory (under perpetual system): 125,000 x 30% = $37,500 (Income statement and bal sheet)
Sales Revenue : $162,500 (Income Statement)
Cost of goods sold (expense):
125,000 x 70% = $87,500 (Income Statement)
Gross profit: 162,500 - 87,500= $75,000 (Income statement)
A/c Payable: $125,000 (Bal Sheet)
A/c receivable: 162,500 x 75%= $121,875 (bal Sheet)