Problem 7-207 [LO 7-4] Bluebell Company sells blue jeans. Last year, bell-bottom

Question

Problem 7-207 [LO 7-4] Bluebell Company sells blue jeans. Last year, bell-bottom jeans were fashionable; this year, boot cut jeans are in style. The company has 535 units of bell-bottom jeans with a cost of $25.00 per unit and a market value of $23.00 per unit. The inventory also includes 1,160 units of boot cut jeans with a cost of $24.00 per unit and a market value of $27.00 per unit. Required Prepare the journal entry, if any, that is required to adjust the Inventory account. (If no entry is required for a transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record the entry for cost of merchandise sold on account from inventories. Note: Enter debits before credits. Transaction General Journal Debit Credit Record entry Clear entry View general journal

Explanation / Answer

General Journal Debit Credit Loss on inventory valuation[535 × ($25.00 - $23.00)] $1,070 Merchandise inventory $1,070 Cost of merchandise sold[(535 × $23.00) + (1,160 × $24)] $40,145 Merchandise inventory $40,145

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