Question 2 Walden Traders, when preparing final account balances at 30 June 2019, has not taken into account the information described below. The business uses the Physical (Periodic) inventory system.

(a) Sales Revenue includes an amount of $1000 received for goods to be delivered to a customer on 17 July 2019. Cost price of the goods was $600.

(b) At 30 June 2019, the Allowance for Doubtful Debts account had a balance of $800 Cr and the Accounts Receivable account had a balance of $30,000 Dr. Bad debts to be written off are $4000. The Allowance for Doubtful Debts account is to be raised to 2% of the adjusted Accounts Receivable.

(c) The physical stocktake at 30th June 2019 revealed Inventory on hand to be $970,000. Inventory at 1st July 2018 is $850,000. During the year purchases were $5,000,000 and purchases returns $25,000. Required: Prepare journal entries to record necessary balance day adjustments including the closing entries to determine COGS in part (c).