Question

consider the following transactions for kc toys
view the transactions.
requirements

1. journalize the purchase transactions. explanations are not required
2. in the final analysis, how much did the inventory cost kc toys?

requirement 1. journalize the purchase transactions. explanations are not required (assume the company uses a perpetual inventory system. record debits first, then credits. exclude explanations from journal entries.)
aug 7 kc toys purchased $189,300 worth of megoblock toys on account with credit terms of 2/10, n/45.
date | accounts | debit | credit
aug 7 | | |

Explanation:

Step1: Record purchase entry

In a perpetual - inventory system, when inventory is purchased on account, we debit the Inventory account and credit the Accounts Payable account.

Date	Accounts	Debit	Credit
Aug 7	Accounts Payable		$189,300$

Step2: Determine inventory cost

Since no other information about returns, allowances, or discounts taken (we assume no payment is made within the discount period as no further information is given) is provided, the cost of inventory for KC Toys is the purchase price of the inventory.
The cost of inventory = $189,300$

Answer:

Date	Accounts	Debit	Credit
Aug 7	Accounts Payable		$189,300$

The cost of inventory for KC Toys is $189,300$.