Explanation Periodic inventory system : The method or system of recording the transactions related to inventory occasionally or periodically is referred as periodic inventory system. Under this system, cost of goods sold account and inventory account are updated only at the end of the period, when the physical count of inventory is taken. Closing entries: This refers to the journal entries that are recorded at the end of an each accounting period. It closes all revenue accounts earned, and all expenses account incurred during the current accounting year to the company’s capital account. Record the closing entry for debit accounts. Date Accounts and Explanation Post Ref Debit ($) Credit ($) Cost of Goods Sold 792,000 Inventory (Beginning Balance) 192,000 Purchases 600,000 (To close the debit accounts that related to the cost of goods sold for the year.) Table (1) Description : Cost of goods sold is a component of equity and it decreases by $792,000. Therefore, debit cost of goods sold account by $792,000. Inventory (Beginning) and Purchases accounts are closed by transferring their amount to cost of goods sold account. Therefore, credit all these accounts with their respective amounts. Record the closing entry for credit accounts. Date Accounts and Explanation Post Ref Debit ($) Credit ($) Inventory (Ending Balance) 72,000 Cost of Goods Sold 72,000 (To close the credit accounts that related to the cost of goods sold for the year...

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Inventory Valuation

Before discussing the topic inventory valuation let’s discuss the meaning of inventory. In accounting, inventory is also known as stock. Inventory means all the finished goods, materials, merchandise that a business holds for the purpose of selling it in…

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Gen Combo Loose Leaf Financial Accounting; Connect Access Card

Ch. 6 - Prob. 1STQ Ch. 6 - 2. Which of the following statements about...Ch. 6 - Prob. 3STQ Ch. 6 - Prob. 4STQ Ch. 6 - Prob. 5STQ Ch. 6 - 6. The two basic approaches to accounting for...Ch. 6 - Prob. 7STQ Ch. 6 - Prob. 8STQ Ch. 6 - Prob. 1DQ Ch. 6 - 2. During the current year, Green Bay Company...

Ch. 6 - Prob. 3DQ Ch. 6 - 4. Define the term inventory shrinkage. How is the...Ch. 6 - Prob. 5DQ Ch. 6 - Prob. 6DQ Ch. 6 - Prob. 7DQ Ch. 6 - 8. How does a balance arise in the Purchase...Ch. 6 - Prob. 9DQ Ch. 6 - Prob. 10DQ Ch. 6 - Prob. 11DQ Ch. 6 - Prob. 12DQ Ch. 6 - 13. Define the term gross profit margin. Explain...Ch. 6 - Prob. 14DQ Ch. 6 - Prob. 15DQ Ch. 6 - Prob. 1BE Ch. 6 - Prob. 2BE Ch. 6 - Prob. 3BE Ch. 6 - BRIEF EXERCISE 6.4 Periodic Inventory...Ch. 6 - Prob. 5BE Ch. 6 - BRIEF EXERCISE 6.6 Periodic Inventory...Ch. 6 - Prob. 7BE Ch. 6 - Prob. 8BE Ch. 6 - Prob. 9BE Ch. 6 - Prob. 10BE Ch. 6 - Prob. 11BE Ch. 6 - Prob. 1E Ch. 6 - EXERCISE 6.2 Effects of Basic Merchandising...Ch. 6 - Prob. 3E Ch. 6 - EXERCISE 6.4 Perpetual Inventory Systems Ranns...Ch. 6 - Prob. 5E Ch. 6 - Prob. 6E Ch. 6 - EXERCISE 6.7 Periodic Inventory Systems Boston...Ch. 6 - Prob. 8E Ch. 6 - Prob. 9E Ch. 6 - Prob. 10E Ch. 6 - Prob. 11E Ch. 6 - Prob. 12E Ch. 6 - Prob. 13E Ch. 6 - Prob. 14E Ch. 6 - Prob. 15E Ch. 6 - Prob. 1AP Ch. 6 - Prob. 2AP Ch. 6 - Prob. 3AP Ch. 6 - Prob. 4AP Ch. 6 - Prob. 5AP Ch. 6 - PROBLEM 6.6A Correcting Errors—Recording of...Ch. 6 - Prob. 7AP Ch. 6 - Prob. 8AP Ch. 6 - Prob. 1BP Ch. 6 - Prob. 2BP Ch. 6 - PROBLEM 6.3B Trend Analysis Shown as follows is...Ch. 6 - Prob. 4BP Ch. 6 - Prob. 5BP Ch. 6 - PROBLEM6.6B Correcting Errors—Recording of...Ch. 6 - Prob. 7BP Ch. 6 - Prob. 8BP Ch. 6 - Prob. 1CTC Ch. 6 - Prob. 2CTC Ch. 6 - Prob. 4CTC

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Chapter 6 Merchandise Inventory; Author: Vicki Stewart;https://www.youtube.com/watch?v=DnrcQLD2yKU;License: Standard YouTube License, CC-BY

Accounting for Merchandising Operations Recording Purchases of Merchandise; Author: Socrat Ghadban;https://www.youtube.com/watch?v=iQp5UoYpG20;License: Standard Youtube License