On April 30, 2018, Quality Appliances purchased equipment for $262,000. The estimated service life of the equipment is six years and
the estimated residual value is $19,000. Quality’s fiscal year ends on December 31. Required: Calculate depreciation for 2018 and 2019 using each of the three methods listed. Quality calculates partial year depreciation based on
the number of months the asset is in service. (Do not round intermediate calculations. Round your final answers to nearest whole

 

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James Company began the month of October with inventory of $20,000. The following inventory transactions occurred during the month:

1. The company purchased merchandise on account for $29,500 on October 12, 2018. Terms of the purchase were 2/10, n/30. James uses the net method to record purchases. The merchandise was shipped f.o.b. shipping point and freight charges of $550 were paid in cash.
2. On October 31, James paid for the merchandise purchased on October 12.
3. During October, merchandise costing $18,750 was sold on account for $29,000.
4. It was determined that inventory on hand at the end of October cost $30,710.

Required:

1. Assuming that the James Company uses a periodic inventory system, prepare journal entries for the above transactions including the adjusting entry at the end of October to record cost of goods sold.

2. Assuming that the James Company uses a perpetual inventory system, prepare journal entries for the above transactions.

 

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