Novak Company sells one product. Presented below is information for January for Novak Company.

Jan. 1		Inventory		125	units at $4 each
4		Sale		104	units at $8 each
11		Purchase		158	units at $6 each
13		Sale		130	units at $9 each
20		Purchase		149	units at $6 each
27		Sale		87	units at $11 each

Novak uses the FIFO cost flow assumption. All purchases and sales are on account.

Assume Novak uses a periodic system. Prepare all necessary journal entries, including the end-of-month closing entry to record cost of goods sold. A physical count indicates that the ending inventory for January is 111 units.

Compute gross profit using the periodic system.

Gross profit

Assume Novak uses a perpetual system. Prepare all necessary journal entries

Compute gross profit using the perpetual system.

Gross profit

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