Hello Bethany,
First what is perpetual inventory?
A method of accounting for inventory that records the sale or purchase of inventory in near real-time, through the use of computerized point-of-sale and enterprise asset management systems. Perpetual inventory provides a highly detailed view of changes in inventory and allows real-time reporting of the amount of inventory in stock, hence, accurately reflecting the level of goods on hand.
How do I journalize the arrival of merchandise using the perpetual inventory system?
- Create a spreadsheet with four columns. One column will display the dates of the transactions, another column will list the account names and the last two columns will represent the "debit" and " credit” columns for the general journal.
- Write the date in the appropriate column and the beginning inventory amount for the specified number of units and price. No "debit" and " credit” entries are required at this point.
- Enter your total purchases in the general journal as your next transaction. Write the date and the "Inventory" account name under the account column. Write the "Accounts Payable" name underneath it. Enter the amount of purchases you made for the period in both the debit and credit columns
Example
Purchase merchandise:
Debit Inventory $xxxxx
Credit Accounts Payable $xxxxx
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