Some of P and Y Electronics merchandise is gathering dust It is now December 31, 2012, and the current replacement cost of the ending inventory is $30,000 below the businesss cost of the goods, which was $95,000 Before any adjustments at the end of the period, the companys Cost of goods sold accoun...

Req 1 Journal Entry DATE ACCOUNTS AND EXPLANATIONS ...

Some of P and Y Electronics merchandise is gathering dust. It is now December 31, 2012, and

Question:

Some of P and Y Electronics’ merchandise is gathering dust. It is now December 31, 2012, and the current replacement cost of the is $30,000 below the business’s cost of the goods, which was $95,000. Before any adjustments at the end of the period, the company’s Cost of goods sold account has a balance of $415,000.
Requirements
1. Journalize any required entries.
2. What amount should the company report for Inventory on the balance sheet?
3. What amount should the company report for Cost of goods sold?
4. Which accounting principle or concept is most relevant to this situation?

Ending Inventory
The ending inventory is the amount of inventory that a business is required to present on its balance sheet. It can be calculated using the ending inventory formula Ending Inventory Formula =...