a. Prepare the FIFO inventory record (see Illustration 6.5 in the textbook) to determine the cost of goods sold and ending inventory resulting from the inventory purchases and sales noted in the transactions above. You will need the cost of goods sold to complete the journal entry for the December 14 and 29 sales. HINT: Be sure you research how to properly account for the freight costs.

b. Prepare the journal entries for the transactions that occurred in December, 2022. For transactions affecting 'Cash', include the cheque number in the explanation.

c. Post the journal entries to the general ledger.

d. Prepare an unadjusted trial balance.

Your business is growing and operations in 2022 have been quite successful. Your business has purchased more equipment. It has also added another revenue stream: selling juicing machines to the public. You have a friend at Morton Manufacturing that has agreed to sell you high-quality juicing machines at a wholesale price so you can sell them to the public at a profit. The business has the following trial balance as at November 30, 2022: Name of Your Business Adjusted trial balance November 30, 2022 4,545 1,575 2,700 265 7,350 1,825 125 875 110 Cash 130 Accounts receivable 135 Inventory 140 Supplies 160 Equipment 161 Accumulated depreciation 210 Accounts payable 230 Unearned revenue 240 Wages payable 245 Interest payable 260 Notes payable 310 capital 320 drawings 410 Sales revenue 505 Cost of goods sold 508 Advertising expense 515 Depreciation expense 527 Interest expense 540 Repairs expense 550 Supplies expense 563 Telephone expense 570 Wages expense 20 6,000 10,250 4,895 13,850 7,450 780 1,675 290 95 315 335 675 32,945 32,945 The $2700 inventory balance is comprised of 4 juicing machines that cost $675 each. The note payable is to the bank and interest is paid on the 1st day of each month. You had paid off the loan to your mother early in 2022. 1 The following transactions happen during the month of December, 2022: Dec You paid the November interest owing on the bank loan. You issued cheque #317. 2 You collected $765 cash from a customer, on account, to whom you had previously sold a juicing machine. You paid the November 30 balance of accounts payable. You issued cheque #318. 9 11 You purchased, on account, 3 more juicing machines for $685 each (excluding freight). The purchase invoice also included a $45 freight charge for the cost of transporting the machines from the vendor to your place. NOTE: Since you will use the FIFO cost-flow assumption, you should make a "FIFO Inventory Record" (See textbook Illustration 6.5) for your Juicing Machine inventory. 12 14 21 You buy $195 of supplies such as protein powder, cups, straws, and fresh fruit and vegetables, on account. You sold, on account, 2 juicing machines to Bill's Fitness for $940 each. You will use the FIFO method of recording inventory transactions. You make and deliver a batch of juice drinks to Fred's Yoga Studio and you issue a sales invoice of $415. The invoice is payable in 30 days. You paid the amount owing on the December 11 purchase. You issued cheque #319. You purchased, on account, 2 more juicing machines for $695 each (excluding freight). The purchase invoice also included a $30 freight charge for the cost of transporting the machines from the vendor to your place. You paid $105 cash for repairs done to some equipment. You issued cheque #320. 23 27 28 29 You sold, on account, 3 juicing machines to the owners of City Contemporary Dance Studio (Remember that freight is part of inventory). The selling price of each machine was $940. 30 31 You received a $115 e-bill for your business cell phone service for December and you paid it immediately. You issued cheque #321. You collected the full amount from the customer who purchased juicing machines on on Dec. 14. You paid a casual worker $85 cash for wages for work done in December. You issued cheque #322. 31 Instructions a. Prepare the FIFO inventory record (see Illustration 6.5 in the textbook) to determine the cost of goods sold and ending inventory resulting from the inventory purchases and sales noted in the transactions above. You will need the cost of goods sold to complete the journal entry for the December 14 and 29 sales. HINT: Be sure you research how to properly account for the freight costs. b. Prepare the journal entries for the transactions that occurred in December, 2022. For transactions affecting 'Cash', include the cheque number in the explanation. C. Post the journal entries to the general ledger. d. Prepare an unadjusted trial balance. We hventory, it should correspond as closely as possible. FIFO often doel match the scalpowol merchandise, because it generally is good business Although the cost for a clisen by conpany does sot have to match the actual physical movement of cost of goods sold used by a vanety of compas practice to sell the oldest units first, particularly if the goods are sobre to spoiler We will use the information for Ingrid's Lighting Boutiques 23W compact forcent light bulbs shown in station to prepare a perpetual inventory record using the FIFO cost formula. Perpetual inventory records are organised to bow how the cost of goods sold for each sale is calculated. They also show the cost and number of units in inventory after each purchase and each sale. That to say the inventory record is continually updated Illustration 6.5 shows the completed inventory record. An explanation of each transaction is provided below corresponding to the namber on the left in the illustration. A 8 C D E F G H 1 M 1 FIFO 2 Date Purchases Cost of goods sold 3 Inventory balance Units Cost Total Units Cost Total Units Cost Jan 1 Total After the purchase on 40) Beginning inventory April 15, the inventory 5 100 $10.00 $1,000.00 100 $10.00 $1,000.00 balance consists of two 6 (2) Apr. 15 100 12.00 1,200.00 100 10.00 tiers totaling $2.200.00 7 1,000.00 100 12.00 1.200.00 Total cost of goods 8 (3) May 1 $10.00 ST.CO0.00 sold for the units sold 9 25 12.00 300.00 75 12.00 900.00 on May 1 * $1,300.00 10. (4) Aug. 24 300 14.00 4 200.00 75 12.00 900.00 11 Inventory after the 300 14.00 4.200.00 12 15 Sept. 1 75 sale on May T consists 12.00 900.00 13 275 14.00 3.850.00 25 14.00 of only one tier - 75 350.00 14162 units totalling $900,00 Nov. 27 400 15.00 6,000.00 25 14.00 350.00 15 400 15.000.000,00 16 17 900 $12,400.00 475 $6,050.00 425 $6,350.00 18 19 Cost of goods available for sale Cost of goods sold Ending inventory 100 ILLUSTRATION 6-5 FIFO Inventory record 1. A perpetual inventory record starts with the inventory balance at the beginning of the year. Ou January a, inventory consisted of 100 units costing $10.00 each for a total cost of $1,000,00 2. On April 15. the company purchases 100 units costing $12.00 nach for a total purchase cost of $1,200.00, inventory now consists of two tiers: 100 linte costing $10.00 each and 100 units conting $13.00 each. Total inventory is 200 units at a total of 8.00 ($1,000,00 1.200.00). The FIFO coat formule requires cast intens to be tracked separately because the earliest costs are the first to be assigned to sales. In Chapters, we are how to prepare the foumal entry for purchasina perpetual system. As a reminder, the journal entry to record the purchase Wrietatai Nalamthaal Apr. Is Merchandise Tentary 1200 Give by here Account Payable or Cash 1,200 Aa 50 20 Your business is growing and operations in 2022 have been quite successful. Your business has purchased more equipment. It has also added another revenue stream: selling juicing machines to the public. You have a friend at Morton Manufacturing that has agreed to sell you high-quality juicing machines at a wholesale price so you can sell them to the public at a profit. The business has the following trial balance as at November 30, 2022: Name of Your Business Adjusted trial balance November 30, 2022 4,545 1,575 2,700 265 7,350 1,825 125 875 110 Cash 130 Accounts receivable 135 Inventory 140 Supplies 160 Equipment 161 Accumulated depreciation 210 Accounts payable 230 Unearned revenue 240 Wages payable 245 Interest payable 260 Notes payable 310 capital 320 drawings 410 Sales revenue 505 Cost of goods sold 508 Advertising expense 515 Depreciation expense 527 Interest expense 540 Repairs expense 550 Supplies expense 563 Telephone expense 570 Wages expense 20 6,000 10,250 4,895 13,850 7,450 780 1,675 290 95 315 335 675 32,945 32,945 The $2700 inventory balance is comprised of 4 juicing machines that cost $675 each. The note payable is to the bank and interest is paid on the 1st day of each month. You had paid off the loan to your mother early in 2022. 1 The following transactions happen during the month of December, 2022: Dec You paid the November interest owing on the bank loan. You issued cheque #317. 2 You collected $765 cash from a customer, on account, to whom you had previously sold a juicing machine. You paid the November 30 balance of accounts payable. You issued cheque #318. 9 11 You purchased, on account, 3 more juicing machines for $685 each (excluding freight). The purchase invoice also included a $45 freight charge for the cost of transporting the machines from the vendor to your place. NOTE: Since you will use the FIFO cost-flow assumption, you should make a "FIFO Inventory Record" (See textbook Illustration 6.5) for your Juicing Machine inventory. 12 14 21 You buy $195 of supplies such as protein powder, cups, straws, and fresh fruit and vegetables, on account. You sold, on account, 2 juicing machines to Bill's Fitness for $940 each. You will use the FIFO method of recording inventory transactions. You make and deliver a batch of juice drinks to Fred's Yoga Studio and you issue a sales invoice of $415. The invoice is payable in 30 days. You paid the amount owing on the December 11 purchase. You issued cheque #319. You purchased, on account, 2 more juicing machines for $695 each (excluding freight). The purchase invoice also included a $30 freight charge for the cost of transporting the machines from the vendor to your place. You paid $105 cash for repairs done to some equipment. You issued cheque #320. 23 27 28 29 You sold, on account, 3 juicing machines to the owners of City Contemporary Dance Studio (Remember that freight is part of inventory). The selling price of each machine was $940. 30 31 You received a $115 e-bill for your business cell phone service for December and you paid it immediately. You issued cheque #321. You collected the full amount from the customer who purchased juicing machines on on Dec. 14. You paid a casual worker $85 cash for wages for work done in December. You issued cheque #322. 31 Instructions a. Prepare the FIFO inventory record (see Illustration 6.5 in the textbook) to determine the cost of goods sold and ending inventory resulting from the inventory purchases and sales noted in the transactions above. You will need the cost of goods sold to complete the journal entry for the December 14 and 29 sales. HINT: Be sure you research how to properly account for the freight costs. b. Prepare the journal entries for the transactions that occurred in December, 2022. For transactions affecting 'Cash', include the cheque number in the explanation. C. Post the journal entries to the general ledger. d. Prepare an unadjusted trial balance. We hventory, it should correspond as closely as possible. FIFO often doel match the scalpowol merchandise, because it generally is good business Although the cost for a clisen by conpany does sot have to match the actual physical movement of cost of goods sold used by a vanety of compas practice to sell the oldest units first, particularly if the goods are sobre to spoiler We will use the information for Ingrid's Lighting Boutiques 23W compact forcent light bulbs shown in station to prepare a perpetual inventory record using the FIFO cost formula. Perpetual inventory records are organised to bow how the cost of goods sold for each sale is calculated. They also show the cost and number of units in inventory after each purchase and each sale. That to say the inventory record is continually updated Illustration 6.5 shows the completed inventory record. An explanation of each transaction is provided below corresponding to the namber on the left in the illustration. A 8 C D E F G H 1 M 1 FIFO 2 Date Purchases Cost of goods sold 3 Inventory balance Units Cost Total Units Cost Total Units Cost Jan 1 Total After the purchase on 40) Beginning inventory April 15, the inventory 5 100 $10.00 $1,000.00 100 $10.00 $1,000.00 balance consists of two 6 (2) Apr. 15 100 12.00 1,200.00 100 10.00 tiers totaling $2.200.00 7 1,000.00 100 12.00 1.200.00 Total cost of goods 8 (3) May 1 $10.00 ST.CO0.00 sold for the units sold 9 25 12.00 300.00 75 12.00 900.00 on May 1 * $1,300.00 10. (4) Aug. 24 300 14.00 4 200.00 75 12.00 900.00 11 Inventory after the 300 14.00 4.200.00 12 15 Sept. 1 75 sale on May T consists 12.00 900.00 13 275 14.00 3.850.00 25 14.00 of only one tier - 75 350.00 14162 units totalling $900,00 Nov. 27 400 15.00 6,000.00 25 14.00 350.00 15 400 15.000.000,00 16 17 900 $12,400.00 475 $6,050.00 425 $6,350.00 18 19 Cost of goods available for sale Cost of goods sold Ending inventory 100 ILLUSTRATION 6-5 FIFO Inventory record 1. A perpetual inventory record starts with the inventory balance at the beginning of the year. Ou January a, inventory consisted of 100 units costing $10.00 each for a total cost of $1,000,00 2. On April 15. the company purchases 100 units costing $12.00 nach for a total purchase cost of $1,200.00, inventory now consists of two tiers: 100 linte costing $10.00 each and 100 units conting $13.00 each. Total inventory is 200 units at a total of 8.00 ($1,000,00 1.200.00). The FIFO coat formule requires cast intens to be tracked separately because the earliest costs are the first to be assigned to sales. In Chapters, we are how to prepare the foumal entry for purchasina perpetual system. As a reminder, the journal entry to record the purchase Wrietatai Nalamthaal Apr. Is Merchandise Tentary 1200 Give by here Account Payable or Cash 1,200 Aa 50 20