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College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570

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BuyFindarrow_forward

College Accounting (Book Only): A ...

13th Edition
Scott + 1 other
ISBN: 9781337280570
Textbook Problem

C. R. McIntyre Company sells candy wholesale, primarily to vending machine operators. Terms of sales on account are 2/10, n/30, FOB shipping point. The following transactions involving cash receipts and sales of merchandise took place in May of this year:

May 2    Received $411.60 cash from N. Rojas in payment of April 23 invoice of $420, less cash discount.

5    Received $2,085 cash in payment of $2,000 note receivable and interest of $85.

8    Sold merchandise on account to G. Soto, invoice no. 862, $830.

9    Received $11,838.40 cash from D. Maddox in payment of April 30 invoice of $12,080, less cash discount.

15    Received cash from G. Soto in payment of invoice no. 862, less cash discount.

16    Cash sales for first half of May, $3,259.

19    Received $296 cash from R. O. Higgins in payment of April 14 invoice, no discount.

22    Sold merchandise on account to N. T. Jennings, invoice no. 863, $753.

25    Received $239 cash refund for return of defective equipment bought in April for cash.

28    Sold merchandise on account to M. E. Mueller, invoice no. 864, $964.

31    Cash sales for second half of May, $4,728.

Required

  1. 1. Journalize the transactions for May in the cash receipts journal and the sales journal. Assume the periodic inventory method is used.
  2. 2. If you are using Working Papers, total and rule the journals. Prove the equality of the debit and credit totals.

1.

To determine

Journalize the transactions in the cash receipts journal and the sales journal using periodic inventory method.

Explanation

Sales Journal: Sales journal is one form of special journal book, which records all the sales transactions that are sold to customers on credit. In a single column sales journal, debit aspect of accounts receivable and credit aspect of inventory are recorded, and then posted to individual subsidiary customer account.

Cash Receipts Journal:  It is a special book where only cash receipts transactions that are received from customers, merchandise sales and service made in cash and collection of accounts receivable are recorded.

Periodic inventory system: The method or system of recording the transactions related to inventory occasionally or periodically are referred to as periodic inventory system.

Transactions in the cash receipts journal:

                                                CASH RECEIPTS JOURNAL                ...

2.

To determine

Show the equality of debits and credits.

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