Assume Webster Company Buys Compact Disks at a Unit Cost

question 125

Short Answer

Assume Webster Company buys compact disks at a unit cost of $20 and sells them at a unit price of $26.There was no beginning inventory.
Provide the journal entries required below by entering the account code of the appropriate account and the amount for each debit and credit:
$\begin{array} { l c } \text { Account Name } & \text { Account Code } \\ \text { Inventory } & \text { A } \\ \text { Purchases } & \text { B } \\ \text { Cost of goods sold } & \text { C } \\ \text { Sales revenue } & \text { D } \\ \text { Cash } & \text { E } \end{array}$

$\begin{array} { c c c } & \text { Transactions } &&&&&&&&&&& \text { Debits } && &&&&\text {Credits} \\ \end{array}$
$\begin{array} { c c c } &&\text { Codes } & \text { Amounts } & \text { Codes } & \text { Amounts }\\\text { A. Purchased 100 units for cash }\\\text { assuming the perpetual }\\\text { inventory system is used. }\\\text { B. Purchased 100 units for cash }\\\text { assuming the periodic }\\\text { inventory system is used.}\\\text { C. Sold 100 units for cash }\\\text { assuming the perpetual }\\\text { inventory system is used.}\\\text { D. Sold 100 units for cash}\\\text { assuming the periodic}\\\text { inventory system is used.}\\ \end{array}$

---

Definitions:

Labor Force

The total number of people who are employed and those actively seeking employment in an economy.

Bowed Out

A term used to describe the shape of a production possibilities frontier that demonstrates increasing opportunity costs.

Resources

This term refers to assets, materials, and components that can be used to produce goods and services.

Productive Inputs

Resources used in the production of goods and services, including labor, capital, and raw materials.