Ask Question
11 May, 03:39

Blossom Company began operations in 2020 and determined its ending inventory at cost and at LCNRV at December 31, 2020, and December 31, 2021. This information is presented below. Cost Net Realizable Value 12/31/20 $379,880 $355,230 12/31/21 445,440 424,430 (a) Prepare the journal entries required at December 31, 2020, and December 31, 2021, assuming inventory is recorded at LCNRV and a perpetual inventory system using the cost-of-goods-sold method. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No entry" for the account titles and enter 0 for the amounts.)

+4
Answers (1)
  1. 11 May, 04:04
    0
    The journal entries are as follows

    On December 31, 2020

    Cost of goods sold $24,650

    To Allowance for reduction in inventory to NRV $24,650

    (Being the cost of goods sold is recorded)

    It is computed below:

    = $379,880 - $355,230

    = $24,650

    On December 31, 2021

    Allowance for reduction in inventory to NRV $3,640

    To Cost of goods sold $3,640

    (Being the allowance for reduction is recorded)

    It is computed below:

    = $24,650 - ($445,440 - $424,430)

    = $24,650 - $21,010

    = $3,640
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “Blossom Company began operations in 2020 and determined its ending inventory at cost and at LCNRV at December 31, 2020, and December 31, ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers