ACCT 201 1st Edition Lecture 21 Outline of Last Lecture I Recording Bad Debt Expense II Recording a Write of Outline of Current Lecture III Exam Review Current Lecture Chapter Five Inventory Merchandising company Perpetual inventory system real time inventory account for purchases Periodic inventory system adjusted purchases account for new inventory When inventory sells there are two entries A L SE Cash AR Revenue Sales Inventory COGS Purchase Gross Profit Chapter Six Inventory Count 1 Physical count what s in front of you 2 Goods in transit being shipped FOB shipping point buyer pays FOB destination seller pays 3 Consigned Goods ownership does not change hands Inventory Methods 1 FIFO first in first out oldest highest profit 2 LIFO last in first out newest These notes represent a detailed interpretation of the professor s lecture GradeBuddy is best used as a supplement to your own notes not as a substitute 3 Average cost weighted average Specific identification high value low volume Ex cars jewelry A R full amount Less Allowances assume not collect contra asset Almost always a percentage usually included with all other adjusted entries A R Net we might actually get Net Realizable Value NRV A Allowance L SE Bad Debt Expense
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