Because Natalie has had such a successful first few months, she is considering other opportunities to develop her buisiness. One opportunity is the sale of fine European mixers. The owner of Kzinski Supply Ca has approached Natalie to become the exclusive distributor of these fine mixers in her state. The current cost of a mixer is approximately $575, and Watalie Would sell each one for \$1,150. Natalie comes to you for advice on how to account for these mixers. Each appliance has a serial number and can be easily identified. Natalie asks you the following questions. 1. "Would you consider these mixers to be inventory or should they be classified as supplies or equipment?" "I ve learned a little about keeping track of imentory using both the perpetual and the periodic systems of accounting for 2. inventoryWhich system do you think is better? Which one would you recomenend for the type of inventory that I want to selip' 3. "How often do I Ineed to count inventory if I maintain it using the perpetual system? Oo I meed to count inventory at all? The triai balance for cookie creations as on December 31.2018 is as follawn: In the end, Natalit decides to use the perpetual Imentory system. The following transactions happen during the month of Januany Jan.4 Bought five deluxe mixers on account from Kzinskik Supply Co. for $2,875, FOB shipping point, terms n/39 6. Paid $100 freight on the January 4 purchase. 7. Returned one of the mixers to Kzinski because it was damaged during shipping. Kzinski issues Cookie Creations credit for the cost of mixer plus $20 for the cost of freight that was paid on January 6 for one mixer. 8 Collected $375 of the accounts receivable from December 2018 . 12 Three deluxe mixers are sold on account for $3,450, FOB destination, terms n/30. (Cost of goods soid is $595 per mixer) 14 Paid the $75 of delivery charges for the three mixers that were sold on January 12. 14. Bought four deluxe mbxers on account from Kzinski Supply Co, for $2,300. FOB shipping point, terms m/s0. 17 Natalie is concerned that there is not enough cash available to pay for all of the mixers purchased. Shic invests an. additional $1,000 cash in Cookie Creations in exchange for common stock 18. Paid $80 treight on the January 14 purchase. 20. Sold two delune mivers for $2,300 cash. (Cost of goods sold is $595 jer mixer.) 29. Natalie issued a check toher assigtant for all the help the assistant hos given her during the month. Her assist ant worked 20 hours in January and is also paid the $56 owed at December 31,2028 . (Natalie's asshtant earns $8 an hour) 28 Collected the amounts due from customers for the Jamuary 12 transaction. 30. Paid a $145 utility bill ( $75 for the December 2018 accounts payabie and $70 for the monthaf fanuary). 31 Peidkzinskiall amounts due. 31 Cash dividends of $750 are paid. 30 Paid a $145 utility bill (\$75 for the December 2018 accounts payable and $70 for the month of January). 31 Paid Kzinskiall amounts due: 31 Cash dividends of $750 are paid; (b1). Prepare the January 2019 transactions. (Credit dccount tides are outomatically indented when amount is entered, Do not indent manuolly. If no entry is required, select "No Entry" for the occount vites and enter O for the omounts Record entries in the order dispiayed in the problem statement.)
