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Home Q & A Board Other Fields Homework Help Business Accounting
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bgottlieb410 bgottlieb410
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5 years ago
At December 31, the Postotnik Company has ending inventory with a historical cost of $630,000.  Assume the company uses the perpetual inventory system.  The current replacement cost of the inventory is $608,000.  The net realizable value is $650,000. The normal profit on this inventory is $50,000. Before any adjustments at the end of the period, the cost of goods sold has a balance of $900,000.  Following IFRS, which journal entry is required on December 31 to adjust the ending balance of inventory if the direct method is used?
A) No journal entry is required.
B) Debit Cost of Goods Sold $20,000 and credit Inventory $20,000.
C) Debit Inventory $20,000 and credit Cost of Goods Sold $20,000.
D) Debit Cost of Goods Sold $22,000 and credit Inventory $22,000.
Textbook 
Intermediate Accounting

Intermediate Accounting


Edition: 1st
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carlx94carlx94
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5 years ago
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bgottlieb410 Author
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#2
5 years ago
I'm still confused, but thanks for answering correctly
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#3
4 years ago
Good
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