The following information is available for the Johnson Corporation: Beginning inventory $27,000
Inventory purchases (on account) 157,000
Merchandise purchases (on account) 157,000
Freight charges on purchases (paid in cash) 12,000
Merchandise returned to supplier (for credit) 14,000
Ending inventory 32,000
Sales (on account) 252,000
Cost of merchandise sold 150,000

Required:
Applying both a perpetual and a periodic inventory system, prepare the journal entries that summarize the transactions that created these balances. Include all end-of-period adjusting entries indicated.

Perpetual Inventory System:

1)Dr Inventory157,000

Cr Accounts Payable 157,000

2) Dr Inventory12,000

Cr Cash 12,000

3)Dr Accounts Payable14,000

Cr Inventory 14,000

4) Dr Accounts Receivable252,000

Cr Sales Revenue 252,000

5) Dr Cost of Goods Sold150,000

Cr Inventory 150,000

6)No entry

Periodic Inventory System:

1)Dr Purchases157,000

Cr Accounts Payable 157,000

2) Dr Freight - in12,000

Cr Cash 12,000

3) Dr Accounts Payable14,000

Cr Purchase Returns 14,000

4) Dr Accounts Receivable252,000

Cr Sales Revenue 252,000

5) No entry

6)Dr Cost of Goods Sold150,000

Dr Ending Inventory32,000

Dr Purchase Returns14,000

Cr Beginning Inventory $27,000

Cr Purchases 157,000

Cr Freight - in $12,000

Explanation:

Preparation of the journal entries that summarize the transactions that created these balances. Include all end-of-period adjusting entries indicated.

PERPETUAL INVENTORY SYSTEM:

1)Dr Inventory157,000

Cr Accounts Payable 157,000

(To record the purchase of inventory on account)

2) Dr Inventory12,000

Cr Cash 12,000

(To record the payment of freight charges by cash)

3)Dr Accounts Payable14,000

Cr Inventory 14,000

(To record the return of inventory purchased on account)

4) Dr Accounts Receivable252,000

Cr Sales Revenue 252,000

(To record the sales made on account)

5) Dr Cost of Goods Sold150,000

Cr Inventory 150,000

(To record the cost of goods sold)

6)No entry

PERIODIC INVENTORY SYSTEM:

1)Dr Purchases157,000

Cr Accounts Payable 157,000

(To record the purchase of inventory on account)

2) Dr Freight - in12,000

Cr Cash 12,000

(To record the payment of freight charges by cash)

3) Dr Accounts Payable14,000

Cr Purchase Returns 14,000

(To record the return of inventory purchased on account)

4) Dr Accounts Receivable252,000

Cr Sales Revenue 252,000

(To record the sales made on account)

5) No entry

6)Dr Cost of Goods Sold150,000

Dr Ending Inventory32,000

Dr Purchase Returns14,000

Cr Beginning Inventory $27,000

Cr Purchases 157,000

Cr Freight - in $12,000

(To record the adjusting entry for inventory)

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