Ceres Computer Sales Uses the Perpetual Inventory System and Had

question 89

Essay

Ceres Computer Sales uses the perpetual inventory system and had the following transactions during the month of December:
$\begin{array}{|c|c|l|}\hline \text { Dec } & 1 & \begin{array}{l}\text { Sold merchandise on credit for } \$ 5,000 \text {, terms } 3 / 10, n / 30 \text {. The items sold had a } \\\text { cost of } \$ 3,500 \text {. }\end{array} \\\hline & 3 & \text { Purchased merchandise for cash, } \$ 720 \text {. } \\\hline & 4 & \text { Purchased merchandise on credit for } \$ 2,600 \text {, term } 1 / 20, \mathrm{n} / 30 \text {. } \\\hline & 5 & \begin{array}{l}\text { Issued a credit memorandum for } \$ 300 \text { to a customer who returned me } \\\text { purchased November } 29 \text {. The returned items had a cost of } \$ 210 \text {. }\end{array} \\\hline& 11 & \text { Received payment for merchandise sold December } 1 . \\\hline &15 & \begin{array}{l}\text { Received a credit memorandum for the return of faulty merchandise purchased on } \\\text { December } 4 \text { for } \$ 600 \text {. }\end{array} \\\hline &18 & \begin{array}{l}\text { Paid freight charges of } \$ 200 \text { for merchandise ordered last month. (FOB shipping } \\\text { point). }\end{array} \\\hline &23 & \begin{array}{l}\text { Paid for the merchandise purchased December } 4 \text { less the portion that was } \\\text { returned. }\end{array} \\\hline& 24 & \begin{array}{l}\text { Sold merchandise on credit for } \$ 7,000, \text { terms } 2 / 10, n / 30 . \text { The items had a cost of } \\\$ 4,900 .\end{array} \\\hline &31 & \text { Received payment for merchandise sold on December } 24 .\\ \hline\end{array}$
Required: Prepare the general journal entries to record these transactions.

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Definitions:

Weighted-Average Process Costing System

A costing methodology that averages the costs of different production batches over a period to calculate the cost per unit.

Equivalent Units

A concept used in cost accounting to convert partially completed units of production into a number of fully completed units for accounting purposes.

Process Costing

A costing methodology used in industries where production is continuous, allocating costs over the entire production process rather than individual products.

Assembly-Type Operations

Manufacturing processes where products are assembled from various components along a production line or assembly station.