E8-4 (Inventoriable Costs-Perpetual) Bradford Machine Company maintains a general

ledger account for each class of inventory, debiting such accounts for increases during the
period and crediting them for decreases. The transactions below relate to the Raw Materials
inventory account, which is devited for materials purchased and credited for materials
requisitioned for use.

1. An invoice for 8.100, terms f.o.b. destination, was received and entered January 2,
2011. The receiving report shows that the materials were received December 28,
2010.
2. Materials costing 7.300 were returned to the supplier on December 29, 2010, and
were shipped f.o.b. shipping point. The return was entered on that date, even though
the materials are not expected to reach the suppliers place of business until January 6,
2011.
3. Materials costing 28.000, shipped f.o.b. destination, were not entered by December
31, 2010, because they were in a railroad car on the companys siding on that date
and had not been unloaded.
4. An invoice for 7.500, terms f.o.b. shipping point, was received and entered
December 30, 2010. The receiving report shows that the materials were received
January 4, 2011, and the bill of lading shows that they were shipped January 2, 2011.
5. Materials costing 19.800 were received December 30, 2010, but no entry was made
for them because they were ordered with a specified delivery of no earlier than
January 10, 2011.
Instructions
Prepare correcting general journal entries required at december 31, 2010, assuming that the
books have not been closed.

E8-5 (Inventoriable Costs-Error Adjusments) Werth Company asks you to review its
December 31, 2010, inventory values and prepare the necessary adjustments to the books.
The following information is given to you.
1. Werth uses the periodic method of recording inventory. A physical count reveals
$234.890 of inventory on hand at December 31, 2010.
2. Not included in the physical count of inventory is $10.420 of merchandise purchased
on December 15 from browser. This merchandise was shipped f.o.b. shipping point
on December 29 and arrived in January. The invoice arrived and was recorded on
December 31.
3. Included an inventory is merchandise sold to Bubbey on December 30, f.o.b.
destination. This merchandise was shipped after it was counted. The invoice was
prepared and recorded as a sale on account for $12.800 on December 31. The
merchandise cost $3.750, and Bubbey received it on January 3.
4. Included in inventory was merchandise received from Dudley on December 31 with
an invoce price $15.630. the merchandise was shipped f.o.b. destination. The invoice,
which has not yet arrived, has not been recorded.
 5. Not included in inventory is $8.540 of merchandise purchased from Minsky
Industries. This merchandise was received on December 31 after the inventory had
been counted. The invoice was received and recorded on December 30.
6. Included in inventory was $10.438 of invntory held by Werth on consignment form
Jackel Industries.
7. Included in inventory is merchandise sold to sims f.o.b shipping point. This
merchandise was shipped after it was counted. The invoice was prepared and
recorded as a sale for $19.800 on December 31. The cost of this merchandise was
$11.250, and Sims received the merchandise on January 5.
8. Excluded from inventory was carton labeled Please accept for credit. This carton
contains merchandise costing $1.500 which had been sold to a costumer $2.600. no
entry had been made to the books to reflect the return, but none of the returned
merchandise seemed damaged.
Instructions
a) Determind the proper inventory balance for Werth Company at December 31, 2010.
b) Prepare any correcting entries to adjust inventory and related accounts to their proper
amounts at December 31, 2010 Assume the books have not been closed.