Windsor Company began operations in and determined its ending inventory at cost and at LCNRV at December
and December This information is presented below.
a Prepare the journal entries required at December and December assuming inventory is
recorded at LCNRV and a perpetual inventory system using the costofgoodssold method. List all debit entries
before credit entries. Credit account titles are automatically indented when amount is entered. Do
not indent manually. If no entry is required, select No entry" for the account titles and enter for
the amounts. Record journal entries in the order presented in the problem.
b Prepare journal entries required at December and December assuming inventory is recorded at
LCNRV and a perpetual system using the loss method. List all debit entries before credit entries. Credit
account titles are automatically indented when amount is entered. Do not indent manually. If no
entry is required, select No entry" for the account titles and enter for the amounts. Record journal
entries in the order presented in the problem.
c Which of the two methods above provides the higher net income in each year?
