Chapter 12, Problem 12SPB

### College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756

Chapter
Section

### College Accounting, Chapters 1-27

23rd Edition
HEINTZ + 1 other
ISBN: 9781337794756
Textbook Problem

# PURCHASES JOURNAL, CASH PAYMENTS JOURNAL, AND GENERAL JOURNAL Debbie Mueller owns a small retail business called Debbie’s Doll House. The cash account has a balance of $20,000 on July 1. The following transactions occurred during July:REQUIRED 1. Record the transactions in the purchases journal, cash payments journal, and general journal. Total and rule the purchases and cash payments journals. Prove the cash payments journal. 2. Post from the journals to the general ledger and accounts payable ledger accounts. Use general ledger account numbers as shown in the chapter. 1. To determine Prepare the given transactions in the purchase journal, cash payment journal, and general journal and verify the total column and rule the column Explanation Purchase Journal: Purchase journal records all the merchandise purchase on credit. In a single column purchase journal, debit aspect of inventory and credit aspect of accounts payable are recorded, and then posted to individual subsidiary supplier account. Prepare the given transactions in the purchase journal: Table (1) Cash payments journal: Cash payments journal refers to the journal that is used to record the all transaction which is involve the cash payments. For example, the business paid cash to employees (salary paid to employees). Cash payments journal is used to record merchandise purchases made in cash and payments of accounts payable. It also records all other cash payments to various purposes. To include all these transactions, companies use multi-column cash payments journal. Prepare the given transactions in a cash payments journal and total the each column of cash payments journal: Table (2) Working note 1: Calculate the amount of purchases discounts (credit) on dated 11th July: PurchasesÂ discounts(credit)onÂ datedÂ 11thJuly}=(IssuedÂ checkÂ forÂ merchandisedÂ purchasedÂ onÂ accountâˆ’Â ReturnÂ amountÂ ofâ€‰merchandiseÂ Ã—â€‰DiscountÂ rate)=($2,500âˆ’$400Ã—2%)=$2,100Ã—2%=$42 Working note 2: Calculate the amount of purchases discounts (credit) on dated 13th July: PurchasesÂ discounts(credit)onÂ datedÂ 13thJuly}=(IssuedÂ checkÂ forÂ merchandisedÂ purchasedÂ onÂ accountÂ Ã—â€‰DiscountÂ rate)=($2,800Ã—1%)=\$28

Working note 3:

Calculate the amount of purchases discounts (credit) on dated 18th July:

PurchasesÂ discounts(credit)onÂ datedÂ 18thJuly}=(IssuedÂ checkÂ forÂ merchandisedÂ purchasedÂ onÂ accountâˆ’Â <

2.

To determine

Post the purchase journal and cash payment journal to the general ledger and accounts payable ledger.

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