Consider the January 2014 transactions for Kerr Consulting Company that were presented in Chapter 5.
Jan. 2 Completed a consulting engagement and received cash of $7,200.
2 Prepaid three months' office rent $9,000.
7 Purchased 100 units of software inventory on account, $1,900, plus freight in, $100.
16 Paid employee salary, $2,000. (Note previous year-end accrual of $500.)
18 Sold 70 software units on account, $3,100.
19 Consulted with a client for a fee of $900 on account.
21 Paid on account, $2,000, for the January 7 purchase.
22 Purchased 200 units of software inventory on account, $4,600.
24 Paid utilities, $300 cash.
28 Sold 100 units of software for cash, $4,000.
31 Recorded the following adjusting entries:
Accrued salary expense, $1,000.
Prepaid rent used $3,000.
Amortization of office furniture, $100, and of equipment, $33.
Physical count of inventory, 120 units
Required
1. Prepare perpetual inventory records for January for Kerr Consulting Company using the moving-weighted-average perpetual method. Round average cost per unit to the nearest cent and all other amounts to the nearest dollar. You must calculate cost of goods sold for the January 18, 22, 28, and 31 transactions.
2. Journalize and post to T-accounts the January transactions using the perpetual inventory record created in Requirement 1. Key all items by date. Use the opening balances given in Serial Exercise 5-28 on page 319. Compute each account balance, and denote the balance as Bal. (Adjusting entries are recorded in Requirement 3.)
3. Journalize and post to T-accounts the adjusting entries. Denote each adjusting amount as Adj. After posting all adjusting entries, prove that the debits equal the credits by completing a trial balance.