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Part 1 of 2 Points: 0 of 1 Naturally Good Foods reports merchandise inventory at the lower - of - cost - or - market.
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Naturally Good Foods reports merchandise inventory at the lowerofcostormarket. Prior to releasing its financial statements for the year ended May Naturally's preliminary income statement, before the yearend adjustments, appears as follows:
Click the icon to view the preliminary income statement.
Naturally has determined that the current replacement cost of ending merchandise inventory is $ Cost is $
Read the requirements.
Requirement Journalize the adjusting entry for merchandise inventory, if any is required. Record debits first, then credits. Select the explanation on the last line of the journal entry. For situations that do not require an entry, make sure to select No entry required" in the first cell in the "Accounts" column and leave all other cells blank.
tableDateAccounts and Explanation,Debit,CreditMay
Data table
tableNaturally Good FoodsIncome Statement PartialYear Ended May Net Sales Revenue,$Cost of Goods Sold,,Gross Profit,$
Requirements
Journalize the adjusting entry for merchandise inventory, if any is required.
Prepare a revised partial income statement to show how Naturally Good Foods should report sales, cost of goods sold, and gross profit.
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