**Hercula Cycles Inventory Management****Overview:**Hercula Cycles started January with 12 bicycles that cost $42 each. On January 16, Hercula purchased 40 bicycles at $68 each. On January 31, Hercula sold 23 bicycles for $90 each.**Requirements:**1. Prepare Hercula Cycle’s perpetual inventory record assuming the company uses the weighted-average inventory costing method.2. Journalize the January 16 purchase of merchandise inventory on account and the January 31 sale of merchandise inventory on account.---**Requirement 1: Perpetual Inventory Record***Assume the company uses the weighted-average inventory costing method.*1. **Begin with the Beginning Inventory Balances:** - Enter transactions in chronological order. - Calculate new inventory on hand balances after each transaction. - Calculate the quantity and total cost of inventory purchased, sold, and on hand at the end of the period.2. **Inventory Table:**| Date | Purchases | Cost of Goods Sold | Inventory on Hand ||--------|--------------------------------|--------------------------------------|----------------------------------|| | QTY | Unit Cost | Tot. Cost | QTY | Unit Cost | Tot. Cost | QTY | Unit Cost | Tot. Cost || Jan. 1 | 12 | $42 | $504 | | | | | | |*(Abbreviation used: QTY = Quantity; Tot. = Total)***Instructions for Inventory Calculation:**- For each transaction, update the table accordingly.- For example, on January 16, record the purchase of additional units.- Calculate the new unit cost using the weighted average.- Record sales on January 31, adjusting the inventory to reflect goods sold.This table helps in visualizing and managing inventory costs effectively using the weighted-average cost method. Make sure to follow the structure step-by-step for accurate financial management. **Text Transcription for Educational Website:**---Some of J and B Electronics' merchandise is gathering dust. It is now December 31, 2024, and the current replacement cost of the ending merchandise inventory is $14,000 below the business’s cost of the goods, which was $95,000. Before any adjustments at the end of the period, the company's Cost of Goods Sold account has a balance of $400,000.Read the requirements.---**Requirement 1.** Journalize any required entries. *(Record debits first, then credits. Select the explanation on the last line of the journal entry table. 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.)*The required journal entry would be:| Date | Accounts and Explanation | Debit | Credit ||----------|---------------------------|-------|--------|| Dec. 31 | | | || | | | || | | | || | | | |---**Requirements Box:**1. Journalize any required entries.2. At what amount should the company report merchandise inventory on the balance sheet?3. At what amount should the company report cost of goods sold on the income statement?4. Which accounting principle or concept is most relevant to this situation?**[Buttons: Print | Done]**

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Description: **Hercula Cycles Inventory Management****Overview:**Hercula Cycles started January with 12 bicycles that cost $42 each. On January 16, Hercula purchased 40 bicycles at $68 each. On January 31, Hercula sold 23 bicycles for $90 each.**Requirements:**1

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Hercula Cycles started January with 12 bicycles that cost $42 each. On January 16, Hercula purchased 40 bicycles at $68 each. On January 31, Hercula sold 23 bicycles for $90 each. Requirements 1. Prepare Hercula Cycle's perpetual inventory record assuming the company uses the weighted-average inventory costing method. 2. Journalize the January 16 purchase of merchandise inventory on account and the January 31 sale of merchandise inventory on account. Requirement 1. Prepare Hercula Cycle's perpetual inventory record assuming the company uses the weighted-average inventory costing method. Start by entering the beginning inventory balances. Enter the transactions chronological order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of inventory purchased, sold, and on hand at the end of the period. (Abbreviation used: QTY = Quantity: Tot. = Total) Hercula Cycles Date Jan. 1 Purchases QTY Unit Cost Tot. Cost Cost of Goods Sold QTY Unit Cost Tot. Cost Inventory on Hand QTY Unit Cost Tot. Cost

Hercula Cycles started January with 12 bicycles that cost $42 each. On January 16, Hercula purchased 40 bicycles at $68 each. On January 31, Hercula sold 23 bicycles for $90 each. Requirements 1. Prepare Hercula Cycle's perpetual inventory record assuming the company uses the weighted-average inventory costing method. 2. Journalize the January 16 purchase of merchandise inventory on account and the January 31 sale of merchandise inventory on account. Requirement 1. Prepare Hercula Cycle's perpetual inventory record assuming the company uses the weighted-average inventory costing method. Start by entering the beginning inventory balances. Enter the transactions chronological order, calculating new inventory on hand balances after each transaction. Once all of the transactions have been entered into the perpetual record, calculate the quantity and total cost of inventory purchased, sold, and on hand at the end of the period. (Abbreviation used: QTY = Quantity: Tot. = Total) Hercula Cycles Date Jan. 1 Purchases QTY Unit Cost Tot. Cost Cost of Goods Sold QTY Unit Cost Tot. Cost Inventory on Hand QTY Unit Cost Tot. Cost

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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