Inventories Control Account Balance

Buy ready-to-submit essays. No Plagiarism Guarantee!

Note: Our papers are 100% human-written. 

Check before you submit. Get Turnitin Score Report in 15 Minutes.

Don't risk the 'Red' score. Get the exact same Turnitin report your professor uses. Join 50,000+ students who submitted their essays with confidence this semester.

Get Turnitin Score Report Request Human Rewrite

Explain how and why this happens. Chart of Accounts 101 Cash at bank 203 GST collected 102 Inventory 204 GST paid 103 Store supplies 401 Sales revenue 104 Accounts receivable 402 Sales returns and allowances 150 Office Equipment 501 Cost of goods sold 201 Accounts payable 601 Freight-in 202 Bill payable 602 Electricity expense 3 4 Question 2 The invento ries control account balance of St George Fashions at 30 June 2023 was $110 510 using the perpetual method. A physical count conducted on that day found inventories on hand worth $110 100. Net realisab le value for each invento ries item held for sale exceeded cost. An investigatio n of the discrepancy revealed the following. Goods worth $3300 held on consignme nt for Rockhampton Accessories had been included in the physical count. Goods costing $600 were purchased on credit from Springbrook Ltd on 27 June 2023 on FOB shipping terms. The goods were shipped on 28 June 2023 but, as they had not arrived by 30 June 2023, were not included in the physica l count. The purchase invoice was received and processed on 30 June 2023. Goods costing $1200 were sold on credit to Noosa Pty Ltd for $1950 on 28 June 2023 on FOB destinatio n terms. The goods were still in transit on 30 June 2023. The sales invoic e was raise d and processed on 29 June 2023. Goods costing $1365 were purchased on credit (FOB destinatio n) from Launceston Handba gs on 28 June 2023. The goods were received on 29 June 2023 and included in the physica l count. The purchase invoice was received on 2 July 2023. On 30 June 2023, St George Fashions sold goods costing $3150 on credit (FOB shipp in g) terms to Kurnells Boutique for $4800. The goods were dispatched from the warehouse on 30 June 2023 but the sales invoice had not been raised at that date. Damaged inventories valued at $1325 were discovered during the physical count. These ite ms were still recorded on 30 June 2023 but were omitted from the physical count records pend ing their write-off. Re quire d 1. Prepare any journal entries necessary on 30 June 2023 to correct any errors and to adjust inventories. 2. i) What does the term net realisable value mean? 2. ii) What sources of evidence could a company use to determine net realisable value? 2. iii)W hat action should a company take at year end if some of its inventory items have declined in value while other inventory items have increased in value? Why?