Perpetual Inventory Brody sports Ltd.
Brody Sports, is a sports shop that carries a range of sporting goods. The most popular selling items are all hockey
related items. They carry a range of NHL replica jerseys and of course international teams. By far the biggest selling
jersey is the Canadian jersey. Local teams purchase their jerseys from a range of jerseys they have on offer. A lot of
customers pay in cash, but the teams that have accounts with the store can purchase on account, usually 2/10, net
30.
The store manager ensures that the staff rotate the stock so that the older items are displayed at the front of the
shelves and are sold first. When large orders are placed, the same system applies and Brody Sports uses a
perpetual FIFO system to manage its inventory.
You have been hired as a book keeper to maintain the sales journal and keep a track of inventory using your
knowledge of perpetual FIFO systems.
During the month of September the following transactions takes place. Brody Sports already has a stock of 40
jerseys that had a cost price of $25 each, from last year. September tends to be a busy month as teams come in to
buy jerseys for the new season.
1-Sep Sold 20 jerseys for cash (selling price $125 each)
2-Sep Purchases another 65 jerseys at $30 each. Terms 2/10, net 30.
9-Sep Sold another 30 jerseys on account, 2/10 net 30, to the West End Worblers. (selling price $120 each)
14-Sep Paid for the purchase on Sep 2nd.
17-Sep Purchases another 50 jerseys at $33 each. Terms 2/10, net 30.
21-Sep Sold another 50 jerseys on account, 2/10 net 30, to the East Side Mainers. (selling price $115 each 22-Sep West end worblers, settled their account by paying for the purchase on the 9th of Sep in full.
22-Sep
23-Sep East side Mainers, settled their account by paying for the remainder of the purchase on 21st in full.
24-Sep Sold another 5 jerseys for cash (selling price $125 each)
29-Sep Stock account revealed, that there are only 32 jerseys were in stock. Adjust inventory if needed.
NOTE: the inventory charts only go to the 24th
Date
Purchases Sales Balance
Quantity Unit cost Value Quantity Unit cost Value Quantity Unit cost Value
Opening
1-Sep
2-Sep
9-Sep
17-Sep
21-Sep
24-Sep
Date Description Ref DR CR
East side Mainers, returned 4 defective jerseys, purchased on the 21st.
a) Complete the following table to track cost of goods sold during the month. (using FIFO method)
b) Journalise each transaction for the month, using the perpetual method.
DATE, DISCRIPTION, REF, DR, CR,
c) Complete the following table to track cost of goods sold during the month. (using Avearge method) Purchases Sales Balance
Quantity Unit cost Value Quantity Unit cost Value Quantity Unit cost Value
Purchases Sales Balance