Coney Island Inc. had the following operating transactions during January 2020, its first month of operations. Date Transaction 1/1 Purchased 2 units of inventory costing $4 each on credit 1/3 Purchased 3 units of inventory costing $5 each on credit 1/10 Purchased 4 units of inventory costing $6 each on credit 1/21 Paid for the January 1 purchase 1/23 Paid for the January 3 purchase 1/30 Sold 7 units of inventory at $10 each on credit 1/30 Matched the inventory cost to January 30 on a FIFO basis 1/31 Estimated that 10% of credit sales will not be realized in cash Record the above transactions in Coney Island’s journal Present Coney’s income statement through gross profit for January 2020
Coney Island Inc. had the following operating transactions during January 2020, its first month of operations.
Date Transaction
1/1 Purchased 2 units of inventory costing $4 each on credit
1/3 Purchased 3 units of inventory costing $5 each on credit
1/10 Purchased 4 units of inventory costing $6 each on credit
1/21 Paid for the January 1 purchase
1/23 Paid for the January 3 purchase
1/30 Sold 7 units of inventory at $10 each on credit
1/30 Matched the inventory cost to January 30 on a FIFO basis
1/31 Estimated that 10% of credit sales will not be realized in cash
- Record the above transactions in Coney Island’s journal
- Present Coney’s income statement through gross profit for January 2020
FIFO Method: FIFO means First in First out method is a method to sell the inventory in first which is purchased in first & secondly sell the inventory which is purchased thereafter.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
