new tech cycles started may with 25 bicycles that cost $65 each. on may 16, new tech purchased 50 bicycles…

new tech cycles started may with 25 bicycles that cost $65 each. on may 16, new tech purchased 50 bicycles at $80 each. on may 31, new tech sold 49 bicycles for $97 each. requirements 1. prepare new tech cycles perpetual inventory record assuming the company uses the weighted - average inventory costing method 2. journalize the may 16 purchase of merchandise inventory on account and the may 31 sale of merchandise inventory on account. requirement 1. prepare new tech cycles perpetual inventory record assuming the company uses the weighted - average inventory costing method start by entering the beginning inventory balances. enter the transactions in 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) new tech cycles purchases cost of goods sold inventory on hand date qty unit cost tot cost qty unit cost tot cost qty unit cost tot cost may 1

new tech cycles started may with 25 bicycles that cost $65 each. on may 16, new tech purchased 50 bicycles at $80 each. on may 31, new tech sold 49 bicycles for $97 each. requirements 1. prepare new tech cycles perpetual inventory record assuming the company uses the weighted - average inventory costing method 2. journalize the may 16 purchase of merchandise inventory on account and the may 31 sale of merchandise inventory on account. requirement 1. prepare new tech cycles perpetual inventory record assuming the company uses the weighted - average inventory costing method start by entering the beginning inventory balances. enter the transactions in 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) new tech cycles purchases cost of goods sold inventory on hand date qty unit cost tot cost qty unit cost tot cost qty unit cost tot cost may 1

Answer

Explanation:

Step1: Calculate beginning inventory values

Beginning inventory on May 1: QTY = 25, Unit Cost = $65, Tot Cost = 25 * 65 = $1625.

Date Purchases (QTY, Unit Cost, Tot Cost) Cost of Goods Sold (QTY, Unit Cost, Tot Cost) Inventory on Hand (QTY, Unit Cost, Tot Cost)
May 1 - - 25, 65, 1625

Step2: Record May 16 purchase

On May 16, purchased 50 bicycles at $80 each. New QTY in inventory = 25 + 50 = 75. New Tot Cost = 1625+50 * 80 = 1625 + 4000 = $5625. Weight - average Unit Cost = 5625/75 = $75.

Date Purchases (QTY, Unit Cost, Tot Cost) Cost of Goods Sold (QTY, Unit Cost, Tot Cost) Inventory on Hand (QTY, Unit Cost, Tot Cost)
May 1 - - 25, 65, 1625
May 16 50, 80, 4000 - 75, 75, 5625

Step3: Record May 31 sale

On May 31, sold 49 bicycles. Cost of Goods Sold: QTY = 49, Unit Cost = $75, Tot Cost = 49 * 75 = $3675. Inventory on hand: QTY = 75 - 49 = 26, Unit Cost = $75, Tot Cost = 26 * 75 = $1950.

Date Purchases (QTY, Unit Cost, Tot Cost) Cost of Goods Sold (QTY, Unit Cost, Tot Cost) Inventory on Hand (QTY, Unit Cost, Tot Cost)
May 1 - - 25, 65, 1625
May 16 50, 80, 4000 - 75, 75, 5625
May 31 - 49, 75, 3675 26, 75, 1950

Step4: Journalize May 16 purchase

The journal entry for May 16 purchase on account: Debit: Merchandise Inventory $4000 Credit: Accounts Payable $4000

Step5: Journalize May 31 sale

The journal entry for May 31 sale on account: Debit: Accounts Receivable (49 * 97) = $4753 Credit: Sales Revenue $4753 Debit: Cost of Goods Sold $3675 Credit: Merchandise Inventory $3675

Answer:

Perpetual inventory record:

Date Purchases (QTY, Unit Cost, Tot Cost) Cost of Goods Sold (QTY, Unit Cost, Tot Cost) Inventory on Hand (QTY, Unit Cost, Tot Cost)
May 1 - - 25, 65, 1625
May 16 50, 80, 4000 - 75, 75, 5625
May 31 - 49, 75, 3675 26, 75, 1950
Journal entries:
May 16 purchase:
Debit: Merchandise Inventory $4000
Credit: Accounts Payable $4000
May 31 sale:
Debit: Accounts Receivable $4753
Credit: Sales Revenue $4753
Debit: Cost of Goods Sold $3675
Credit: Merchandise Inventory $3675