Explanation Perpetual inventory system: The method or system of maintaining, recording, and adjusting the inventory perpetually throughout the year, is referred to as perpetual inventory system. Gross method: Under gross method, sales and purchases of merchandises are recorded at the full invoice price (gross amount) without the deduction of discounts. Prepare journal entries to record the purchases. Date Account title and Explanation Post ref. Amount Debit Credit November 05 Merchandise Inventory ( 600 units × $ 10 ) $6,000 Accounts payable $6,000 (To record the purchase of 600 units of products at $10 on account, credit terms of 2 / 10 , n / 60 ) November 07 Accounts payable ( 25 units × $ 10 ) $250 Merchandise Inventory $250 (To record the returns of defective units) November 15 Accounts payable $5,750 Merchandise Inventory (1) $115 Cash (2) $5,635 (To record the payment for merchandises within the discount period) Table (1) November 05: To record the 600 units of products purchased at $10 on account, credit terms of 2 / 10 , n / 60 : Merchandise Inventory is an asset and the value is increased due to the credit purchases on account. Therefore, debit Merchandise Inventory account with $6,000 ( 600 units × $ 10 ) . Accounts Payable is a liability and it is increased due to the increase in the amount to be paid for purchases. Therefore, credit Accounts Payable account with $6,000 ( 600 units × $ 10 ) . November 07: To record the returns of defective units: Accounts Payable is a liability and is decreased due to the return of defective merchandise inventory

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At the beginning of the recent period there were 850 units of product in a department, one-fourth completed. These units were finished and an additional 4,750 units were started and completed during the period. 720 units were still in process at the end of the period, one-fifth completed. Using the weighted-average valuation method, the equivalent units produced by the department were ____ units.

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