QuestionQuestion

(1) What is the difference between FOB Shipping Point and FOB Destination Point. Which of the two will cause a debit to Inventory for the buyer and a debit for the seller?

(2) Make the journal entries for the following transactions assuming a perpetual inventory system.
1. On June 2, Upsy Corporation sold $900,000 of jet parts to Fly By Night with terms of 2/10 net 30. The cost of the merchandise was $620,000.
2. On June 10, Fly By Night returned $90,000 of the merchandise purchased June 2. The cost of the returned merchandise was $62,000.
3. On June 12, Upsy received the balance due from Fly By Night.
Date                   Account                Debit                     Credit

(3) The end of year perpetual inventory record for Upsy Company showed merchandise inventory valued at $98,000. A physical count of the inventory shown that $95,700 was actually on hand. Make the adjusting entry.
Date                   Account                  Debit                   Credit

(4) Parkwood Department Store uses a perpetual inventory system. Data for the shirt department include the following purchases for restocking:
Date             Number of Units            Unit Price
May 7                      50                           $10
July 28                     30                           $13
On June 23 Parkwood sold 26 units and on August 25, they sold 40 more units. Prepare a perpetual inventory schedule for the aforementioned transactions using (A) FIFO and (B) LIFO.
A) FIFO Method
FIFO Method
Date               Purchases         Cost of Goods Sold         Balance

LIFO Method

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