Perpetual and Periodic Inventory Systems Following is a partial list of account balances for two different merchandising companies. The amounts in the accounts represent the balances at the end of the year before any adjustments are made or the books are closed. Company A Sales Revenue Merchandise Inventory Cost of Goods Sold $50,000 12,000 38,000 Company B Sales Revenue Merchandise Inventory Purchases. Transportation-in $85,000 9,000 41,000 5,000 Required: 1. In a inventory system, every time goods are purchased and sold, the and this account is updated continually. In a system, the Purchases, Purchase Discounts and Purchase Returns and Allowances accounts are temporary accounts shown on the period and used in the system. 2. Refer to the information in the table for Company A. What is the cost of inventory on hand at the end of the year and what is its cost of goods sold for the year? 3. Refer to the information in the table for Company B. What is its cost of goods sold for the year? account is increased and decreased, respectively, account is not updated each time a purchase or sale is made. The , closed at the end of the

Perpetual and Periodic Inventory Systems Following is a partial list of account balances for two different merchandising companies, The amounts in the accounts represent the balances at the end of the year before any adjustments are made or the books are closed. Required: 1. In 3 Inventory system, every time goods are purchased and sold, the account is increased and decreased, respectively. and this account is updated continually, in a system, the account is not updated each time a purchase or sale is made. The Purchases, Purchase Discounts and Purchase Returns and Allowances accounts are temporary accounts shown on the , closed at the end of the period and used in the system. 2. Refer to the information in the table for Company A. What is the cost of inventory on hand at the end of the year and what is its cost of goods sold for the year? 3. Refer to the information in the table for Company B. What is its cost of goods sold for the year