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For the past few years, your client, Omni Care, has operated a small medical practice. Omni Care's current annual revenues are $945,000. Because the accountant has been spending more time each month recording all transactions in a two-column journal and preparing the financial statements, Omni Care is considering improving the accounting system by adding special journals and subsidiary ledgers. Omni Care has asked you to help with this project and has compiled the following information: Estimated Frequency per Month Type of Transaction Fees earned on account 240 Purchase of medical supplies on account 190 Cash receipts from patients on account 175 Cash payments on account 160 Cash receipts from patients at time services are provided Purchase of office supplies on account 120 35 Purchase of magazine subscriptions on account Purchase of medical equipment on account 4 Cash payments for office salaries 3 Cash payments for utilities expense Briefly discuss the circumstances under which special journals would be used 1. in place of a two-column (all-purpose) journal. Include in your answer your recom- mendations for Omni Care's medical practice. 2. Assume that Omni Care has decided to use a revenue journal and a purchases journal. Design the format for each journal, giving special consideration to the needs of the medical practice. 3. Which subsidiary ledgers would you recommend for the medical practice?

For the past few years, your client, Omni Care, has operated a small medical practice. Omni Care's current annual revenues are $945,000. Because the accountant has been spending more time each month recording all transactions in a two-column journal and preparing the financial statements, Omni Care is considering improving the accounting system by adding special journals and subsidiary ledgers. Omni Care has asked you to help with this project and has compiled the following information: Estimated Frequency per Month Type of Transaction Fees earned on account 240 Purchase of medical supplies on account 190 Cash receipts from patients on account 175 Cash payments on account 160 Cash receipts from patients at time services are provided Purchase of office supplies on account 120 35 Purchase of magazine subscriptions on account Purchase of medical equipment on account 4 Cash payments for office salaries 3 Cash payments for utilities expense Briefly discuss the circumstances under which special journals would be used 1. in place of a two-column (all-purpose) journal. Include in your answer your recom- mendations for Omni Care's medical practice. 2. Assume that Omni Care has decided to use a revenue journal and a purchases journal. Design the format for each journal, giving special consideration to the needs of the medical practice. 3. Which subsidiary ledgers would you recommend for the medical practice?

Business Its Legal Ethical & Global Environment
Business Its Legal Ethical & Global Environment
10th Edition
ISBN:9781305224414
Author:JENNINGS
Publisher:JENNINGS
Chapter20: Management Of Employee Welfare
Section: Chapter Questions
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For the past few years, your client, Omni Care, has operated a small medical practice. Omni Care's current annual revenues are $945,000. Because the accountant has been spending more time each month recording all transactions in a two-column journal and preparing the financial statements, Omni Care is considering improving the accounting system by adding special journals and subsidiary ledgers. Omni Care has asked you to help with this project and has compiled the following information: Estimated Frequency per Month Type of Transaction Fees earned on account 240 Purchase of medical supplies on account 190 Cash receipts from patients on account 175 Cash payments on account 160 Cash receipts from patients at time services are provided Purchase of office supplies on account 120 35 Purchase of magazine subscriptions on account Purchase of medical equipment on account 4 Cash payments for office salaries 3 Cash payments for utilities expense Briefly discuss the circumstances under which special journals would be used 1. in place of a two-column (all-purpose) journal. Include in your answer your recom- mendations for Omni Care's medical practice. 2. Assume that Omni Care has decided to use a revenue journal and a purchases journal. Design the format for each journal, giving special consideration to the needs of the medical practice. 3. Which subsidiary ledgers would you recommend for the medical practice?
Transcribed Image Text:For the past few years, your client, Omni Care, has operated a small medical practice. Omni Care's current annual revenues are $945,000. Because the accountant has been spending more time each month recording all transactions in a two-column journal and preparing the financial statements, Omni Care is considering improving the accounting system by adding special journals and subsidiary ledgers. Omni Care has asked you to help with this project and has compiled the following information: Estimated Frequency per Month Type of Transaction Fees earned on account 240 Purchase of medical supplies on account 190 Cash receipts from patients on account 175 Cash payments on account 160 Cash receipts from patients at time services are provided Purchase of office supplies on account 120 35 Purchase of magazine subscriptions on account Purchase of medical equipment on account 4 Cash payments for office salaries 3 Cash payments for utilities expense Briefly discuss the circumstances under which special journals would be used 1. in place of a two-column (all-purpose) journal. Include in your answer your recom- mendations for Omni Care's medical practice. 2. Assume that Omni Care has decided to use a revenue journal and a purchases journal. Design the format for each journal, giving special consideration to the needs of the medical practice. 3. Which subsidiary ledgers would you recommend for the medical practice?
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