Problem 6: Aircard Corporation tracks the number of units purchased and sold throughout each accounting period. The company makes all purchases on account and requires that their suppliers provide credit terms of 2/30, N/60. All sales are also on account and Aircard provides customers with credit terms of 1/15, N/30.

Number of units $/unit

July 1 Beginning Inventory 2,000 $20

July 3 Purchased 1,000 $21

July 5 Sold 1,000 $54

July 13 Purchased 6,000 $22

June 15 Purchased 3,000 $23

July 17 Sold 5,000 $60

Complete the requirements for the following independent situations. You are required to show your work to get credit for any part of this question. Round calculations to 2 decimal places.

a) The company uses the perpetual inventory system. The company uses the first-in-first-out method to calculate its inventory cost.

i. What is the value of ending inventory at July 31?

ii. What is the total value of cost of goods sold for the month of July?

iii. Prepare the journal entries required on July 5 and July 13.

iv. Aircard pays off the July 13th transaction on August 1. Prepare the journal entry required when Aircard pays off its account.

b) The company uses the periodic inventory system. The company uses the weighted-average method to calculate its inventory cost. The companys accountant performs an inventory count on July 31 and there are 5,800 units of inventory remaining.

i. What is the value of ending inventory at July 31?

ii. What is the total value of cost of goods sold for the month of July?