Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

James Dean trades in clothing for the middle market. James Dean Clothing use the Periodic Inventory Method to keep records of trade goods. The following

image text in transcribed
image text in transcribed
image text in transcribed
James Dean trades in clothing for the middle market. James Dean Clothing use the Periodic Inventory Method to keep records of trade goods. The following is an extract of balances from the general ledger for the year ended 28 February 2021; Extract of balances as at 28 February 2021 R Revenue from sale of trade goods 735 100 Rent income received from tenant 66 000 150 500 Inventory: Trade goods - balance at 1 March 2020 : Consumables on hand at 1 March 2020 Purchases 7 600 353 000 Settlement discounts received 18 400 Settlement discounts granted 15 800 Railage inwards 36 200 Railage outwards 39 100 Goods returned to suppliers 21 400 Goods returned by customers 34 600 Additional information: 1. Physical stock-take at 28 February 2021 determined the following: Trade goods R166 800 Consumables on hand R 7940 2. Goods to the value R7 600 were donated to the local community organisation. REGENT BUSINESS SCHOOL (RBS) - JULY 2021 24 BACHELOR OF COMMERCE YEAR 1 - ACADEMIC AND ASSESSMENT CALENDAR - DISTANCE 3. An invoice for R4 500 was received on 28 February 2021 for goods transported from the supplier to James Dean Clothing. The invoice needs to be recorded. Sa w x 3. An invoice for R4 500 was received on 28 February 2021 for goods transported from the supplier to James Dean Clothing. The invoice needs to be recorded. 4. James Dean rents office space to a tenant. Rental income of R18 700 was credited to the sales in error. A correction needs to be recorded. Required: 3.1 Show journal entries to record adjustments for all the additional information. (6) 3.2 Prepare the trading section of the Statement of Profit or Loss and other comprehensive income for James Dean Clothing for the year ended 28 February 2021. Sales, Cost of sales and gross profit must be shown. Also show the gross profit percentage (%) on cost. (16) 3.3 Briefly describe three important features of the Perpetual Inventory Method (3)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Ebook Principles Of Financial Accounting

Authors: John Wild, Ken Shaw, Barbara Chiappetta

2nd Edition

0077166183, 9780077166182

More Books

Students also viewed these Accounting questions