Chapter 5, Problem 5.15EX

Posting a purchases journal

The purchases journal for Newmark Exterior Cleaners Inc. follows. The accounts payable account has a March 1, 20Y2, balance of $580 for an amount owed to Nicely Co. No payments were made on creditor invoices during March.

a.    Prepare a T account for the accounts payable creditor accounts.

b.    Post the transactions from the purchases journal to the creditor accounts and determine their ending balances.

c.    Prepare T accounts for the accounts payable control and cleaning supplies accounts. Post control totals to the two accounts, and determine their ending balances. Cleaning Supplies had a zero balance at the beginning of the month.

d.    Prepare a schedule of the creditor account balances to verify the equality of the sum of the accounts payable creditor balances and the accounts payable controlling account balance.

c.    How might a computerized accounting system differ from the use of a purchases journal in recording purchase transactions?