Accounting by Manufacturing Companies

Accounting by Manufacturing Companies - periodic inventory...

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Accounting by Manufacturing Companies The accounting cycle is the same in a manufacturing company, merchandising company, and a  service company. Journal entries are used to record transactions, adjusting journal entries are used  to recognize costs and revenues in the appropriate period, financial statements are prepared, and  closing entries are recorded. Raw material purchases are recorded in the raw material inventory  account if the perpetual inventory method is used, or the raw materials purchases account if the 
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Unformatted text preview: periodic inventory method is used. For example, using the periodic inventory method, the purchase of $750 of raw materials on account is recorded as an increase (debit) to raw materials purchases and an increase (credit) to accounts payable. General Journal Date Account and Title Description Ref. Debit Credit 20X0 May 27 Raw Materials Purchases 750 Accounts PayableTLM Co. 750 Purchase materials from TLM...
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