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:

Consideration

The value (which could be in the form of money, goods, services, or a promise) exchanged between parties in a contract, making the agreement legally binding.

Tort of Deceit

A civil wrong that involves making false representations with the intentional or reckless disregard for the truth, causing someone else to suffer damage.

Contract Terms

The specific provisions, conditions, and requirements agreed upon by the parties in a contract.

Past Consideration

Consideration given or action performed prior to the current agreement, which is generally not valid as consideration for a current contract.