Question - On December 1, 2014, Seattle Company had the account balances shown below.
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Debits
|
|
Credits
|
|
Cash
|
$6,980
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Accumulated Depreciation-Equipment
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$1,330
|
|
Accounts Receivable
|
3,880
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Accounts Payable
|
2,860
|
|
Inventory (3,400 x $0.64)
|
2,176
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Common Stock
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21,900
|
|
Equipment
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20,800
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Retained Earnings
|
7,746
|
|
$33,836
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|
$33,836
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The following transactions occurred during December.
Dec. 3 Purchased 4,600 units of inventory on account at a cost of $0.74 per unit.
Dec. 5 Sold 4,900 units of inventory on account for $0.89 per unit. (It sold 3,400 of the $0.64 units and 1,500 of the $0.74.)
Dec. 7 Granted the December 5 customer $89 credit for 100 units of inventory returned costing $120. These units were returned to inventory.
Dec. 17 Purchased 2,200 units of inventory for cash at $0.79 each.
Dec. 22 Sold 2,000 units of inventory on account for $0.94 per unit. (It sold 2,000 of the $0.74 units.)
Adjustment data:
1. Accrued salaries and wages payable $340.
2. Depreciation on equipment $110 per month.
Compute ending inventory and cost of goods sold under FIFO, assuming Seattle Company uses the periodic inventory system.