Selected balance sheet information for the Wolf Company at N

Selected balance sheet information for the Wolf Company at November 30, and December 31, 2018, is presented below. The company uses the perpetual inventory system and all sales to customers are made on credit. Nov. 30 Debits Credits Dec. 31 Debits Credits Accounts receivable Prepaid insurance Inventory Accounts payable Salaries and wages payable 9, 400 4,400 6, 400 2,400 6,900 5,400 11,400 4,400 14,400 2,400 The following cash flow information also is available a. Cash collected from credit customers, $74,000 b. Cash paid for insurance, $4,400 c. Cash paid to suppliers of inventory, $54,000 (the entire accounts payable amounts relate to inventory purchases) d. Cash paid to employees for salaries and wages, $9,400 Required: 1. Determine the following for the month of December 2. Prepare summary journal entries to record the month\'s sales and cost of those sales

Solution

Solution:-

1.

A. Sales revenue during December:- 2,400 + 74,000 - 9,400 = $ 67,000

Purchase during December:- 14,400 + 54,000 - 11,400 = $ 57,000

B. Cost of goods sold during December:- 6,400 + 57,000 - 5,400 = $ 58,000

C. Insurance expenses during December:- 4,400 + 4,400 - 6,900 = $ 1,900

D. Wage expenses during December:- 2,400 + 9,400 - 4,400 = $ 7,400

2.

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General journal	debit	credit
Account receivable	67,000
Sales revenue		67,000
Cost of goods sold	58,000
Inventory		58,000