(a)
To journalize: The transactions of Company R for the month of December
(a)
Explanation of Solution
Debit and credit rules:
- Debit an increase in asset account, increase in expense account, decrease in liability account, and decrease in
stockholders’ equity accounts. - Credit decrease in asset account, increase in revenue account, increase in liability account, and increase in stockholders’ equity accounts.
Prepare journal entries of Company R for the month of December.
Date | Account Titles and Description | Post Ref. | Debit ($) | Credit ($) | |
2017 | |||||
December | 7 | Cash | 3,600 | ||
| 3,600 | ||||
(To record cash collected from customers) | |||||
December | 12 | Inventory | 12,000 | ||
Accounts Payable | 12,000 | ||||
(To record merchandise purchased on account) | |||||
December | 17 | Accounts Receivable | 16,000 | ||
Sales Revenue | 16,000 | ||||
(To record sales on account) | |||||
December | 17 | Cost of Goods Sold | 10,000 | ||
Inventory | 10,000 | ||||
(To record cost of sales) | |||||
December | 19 | Salaries and Wages Expense | 2,200 | ||
Cash | 2,200 | ||||
(To record payment of salaries) | |||||
December | 22 | Accounts Payable | 12,000 | ||
Cash | 11,880 | ||||
Inventory | 120 | ||||
(To record payment to Company G, less discount) | |||||
December | 26 | Cash | 15,680 | ||
Sales Discounts | 320 | ||||
Accounts Receivable | 16,000 | ||||
(To record amount received from customer) | |||||
December | 31 | Cash | 2,700 | ||
Accounts Receivable | 2,700 | ||||
(To record amount received from customer) |
Table (1)
Working Notes:
Compute purchases discount amount (December 22 entry).
Compute sales discount amount (December 26 entry).
(b)
To post: The December 1 balances and the entries prepared in part (a)
(b)
Explanation of Solution
T-account: The condensed form of a ledger is referred to as T-account. The left-hand side of this account is known as debit, and the right hand side is known as credit.
Cash | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 18,200 | 19 | Salaries and Wages Expense | 2,200 | |
7 | Accounts Receivable | 3,600 | 22 | Accounts Payable | 11,880 | |
26 | Accounts Receivable | 15,680 | ||||
31 | Accounts Receivable | 2,700 | ||||
31 | Total | 40,180 | 31 | Total | 14,080 | |
31 | Ending Balance | $26,100 |
Table (2)
Notes Receivable | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 2,000 | ||||
31 | Total | 2,000 | 31 | Total | 0 | |
31 | Ending Balance | $2,000 |
Table (3)
Accounts Receivable | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 7,500 | 7 | Cash | 3,600 | |
17 | Sales Revenue | 16,000 | 26 | Cash | 15,680 | |
26 | Sales Discounts | 320 | ||||
31 | Cash | 2,700 | ||||
31 | Total | 23,500 | 31 | Total | 22,300 | |
31 | Ending Balance | $1,200 |
Table (4)
Inventory | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 16,000 | 17 | Cost of Goods Sold | 10,000 | |
12 | Accounts Payable | 12,000 | 22 | Accounts Payable | 120 | |
31 | Total | 28,000 | 31 | Total | 10,120 | |
31 | Ending Balance | $17,880 |
Table (5)
Prepaid Insurance | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 1,600 | ||||
31 | Total | 1,600 | 31 | Total | $0 | |
31 | Ending Balance | $1,600 |
Table (6)
Equipment | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 28,000 | ||||
31 | Total | 28,000 | 31 | Total | 0 | |
31 | Ending Balance | $28,000 |
Table (7)
| ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 3,000 | ||||
31 | Total | 0 | 31 | Total | 3,000 | |
31 | Ending Balance | $3,000 |
Table (8)
Accounts Payable | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
22 | Cash | 11,880 | 1 | Beginning balance | 6,100 | |
22 | Inventory | 120 | 12 | Inventory | 12,000 | |
31 | Total | 12,000 | 31 | Total | 18,100 | |
31 | Ending Balance | $6,100 |
Table (9)
Common Stock | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 50,000 | ||||
31 | Total | 0 | 31 | Total | 50,000 | |
31 | Ending Balance | $50,000 |
Table (10)
| ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 14,200 | ||||
31 | Total | 0 | 31 | Total | 14,200 | |
31 | Ending Balance | $14,200 |
Table (11)
Sales Revenue | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
17 | Accounts Receivable | 16,000 | ||||
31 | Total | 0 | 31 | Total | 16,000 | |
31 | Ending Balance | $16,000 |
Table (12)
Sales Discount | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
26 | Accounts Receivable | 320 | ||||
31 | Total | 320 | 31 | Total | 0 | |
31 | Ending Balance | $320 |
Table (13)
Cost of Goods Sold | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
26 | Inventory | 10,000 | ||||
31 | Total | 10,000 | 31 | Total | 0 | |
31 | Ending Balance | $10,000 |
Table (14)
Salaries and Wages Expense | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
19 | Cash | 2,200 | ||||
31 | Total | 2,200 | 31 | Total | 0 | |
31 | Ending Balance | $2,200 |
Table (15)
(c)
To prepare: Bank reconciliation of Company R as at December 31, 2017
(c)
Answer to Problem 7CCCP
Explanation of Solution
Bank reconciliation: Bank statement is prepared by bank. The company maintains its own records from its perspective. This is why the cash balance per bank and cash balance per books seldom agree. Bank reconciliation is the statement prepared by company to remove the differences and disagreement between cash balance per bank and cash balance per books.
Prepare bank reconciliation of Company R as at December 31, 2017.
Company R | |
Bank Reconciliation | |
December 31, 2017 | |
Cash balance as per bank statement | $25,930 |
Add: Deposit in transit | 2,700 |
28,630 | |
Less: Outstanding checks | 1,210 |
Adjusted cash balance per bank | $27,420 |
Cash balance as per books | 26,100 |
Add: Note receivable collected by bank | 2,000 |
28,100 | |
Less: NSF check | 680 |
Adjusted cash balance per books | $27,420 |
Table (16)
(d)
To journalize: The
(d)
Explanation of Solution
Prepare journal entries of Company R as at December 31, 2017.
Date | Account Titles and Description | Post Ref. | Debit ($) | Credit ($) | |
2017 | |||||
December | 31 | Cash | 2,000 | ||
Notes Receivable | 2,000 | ||||
(To record note collected by bank) | |||||
December | 31 | Accounts Receivable | 680 | ||
Cash | 680 | ||||
(To record NSF check as an accounts receivable) | |||||
December | 31 |
| 200 | ||
Accumulated Depreciation–Equipment | 200 | ||||
(To record insurance expense being paid from prepaid insurance) | |||||
December | 31 | Insurance Expense | 400 | ||
Prepaid Insurance | 400 | ||||
(To record insurance expense being paid from prepaid insurance) | |||||
December | 31 | Income Tax Expense | 425 | ||
Income Tax Payable | 425 | ||||
(To record accrued income tax expense) |
Table (17)
(e)
To post: The adjusting entries prepared in part (d)
(e)
Explanation of Solution
Post the journal entries of Company R.
Cash | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
31 | Balance before adjusting | 26,100 | 31 | Accounts Receivable | 680 | |
31 | Notes Receivable | 2,000 | ||||
31 | Total | 28,100 | 31 | Total | 680 | |
31 | Ending Balance | $27,420 |
Table (18)
Notes Receivable | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Balance before adjusting | 2,000 | 31 | Cash | 2,000 | |
31 | Total | 2,000 | 31 | Total | 2,000 | |
31 | Ending Balance | $0 |
Table (19)
Accounts Receivable | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Balance before adjusting | 1,200 | ||||
31 | Cash | 680 | ||||
31 | Total | 1,880 | 31 | Total | $0 | |
31 | Ending Balance | $1,880 |
Table (20)
Insurance Expense | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
31 | Prepaid Insurance | 400 | ||||
31 | Total | 400 | 31 | Total | 0 | |
31 | Ending Balance | $400 |
Table (21)
Depreciation Expense | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
31 | Accumulated Depreciation– Equipment | 200 | ||||
31 | Total | 200 | 31 | Total | 0 | |
31 | Ending Balance | $200 |
Table (22)
Prepaid Insurance | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 1,600 | 31 | Insurance Expense | 400 | |
31 | Total | 1,600 | 31 | Total | 400 | |
31 | Ending Balance | $1,200 |
Table (23)
Accumulated Depreciation–Equipment | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
1 | Beginning balance | 3,000 | ||||
Depreciation Expense | 200 | |||||
31 | Total | 0 | 31 | Total | 3,200 | |
31 | Ending Balance | $3,200 |
Table (24)
Income Tax Expense | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
31 | Income tax payable | 425 | ||||
31 | Total | 425 | 31 | Total | 0 | |
31 | Ending Balance | $425 |
Table (25)
Income Tax Payable | ||||||
Date | Details | Debit ($) | Date | Details | Credit ($) | |
2017 | 2017 | |||||
December | December | |||||
31 | Income tax expense | 425 | ||||
31 | Total | 0 | 31 | Total | 425 | |
31 | Ending Balance | $425 |
Table (26)
(f)
To prepare: Adjusted trial balance of Company R as on December 31, 2017
(f)
Explanation of Solution
Adjusted trial balance: The trial balance which reflects the adjusting entries and incorporates the effect of all adjustments in the ledger accounts, is referred to as adjusted trial balance.
Prepare adjusted trial balance of Company R as at December 31, 2017.
Company R | ||
Adjusted Trial Balance | ||
December 31, 2017 | ||
Debit ($) | Credit ($) | |
Cash | $27,420 | |
Accounts Receivable | 1,880 | |
Inventory | 17,880 | |
Prepaid Insurance | 1,200 | |
Equipment | 28,000 | |
Accumulated Depreciation–Equipment | $3,200 | |
Accounts Payable | 6,100 | |
Income Tax Payable | 425 | |
Common Stock | 50,000 | |
Retained Earnings | 14,200 | |
Sales Revenue | 16,000 | |
Sales Discounts | 320 | |
Cost of Goods Sold | 10,000 | |
Depreciation Expense | 200 | |
Salaries and Wages Expense | 2,200 | |
Insurance Expense | 400 | |
Income Tax Expense | 425 | |
Total | $89,925 | $89,925 |
Table (27)
(g)
To prepare: Income statement and classified balance sheet of Company R
(g)
Explanation of Solution
Income statement: The financial statement which reports revenues and expenses from business operations and the result of those operations as net income or net loss for a particular time period is referred to as income statement.
Prepare income statement of Company R for the month ended December 31, 2017.
Company R | ||
Income Statement | ||
For the Month Ended December 31, 2017 | ||
Sales revenue | $16,000 | |
Less: Sales discounts | 320 | |
Net sales | 15,680 | |
Cost of goods sold | 10,000 | |
Gross profit | 5,680 | |
Operating expenses: | ||
Salaries and wages expense | $2,200 | |
Insurance expense | 400 | |
Depreciation expense | 200 | 2,800 |
2,880 | ||
Income tax expense | 425 | |
Net income | $2,455 |
Table (28)
Classified balance sheet: The main elements of balance sheet assets, liabilities, and stockholders’ equity are categorized or classified further into sections in a classified balance sheet. Assets are further classified as current assets, long-term investments, property, plant, and equipment (PPE), and intangible assets. Liabilities are classified into two sections current and long-term. Stockholders’ equity comprises of common stock and retained earnings. Thus, the classified balance sheet includes all the elements under different sections.
Prepare classified balance sheet of Company R as on December 31, 2017.
Company R | ||
Balance Sheet | ||
December 31, 2017 | ||
Assets | ||
Current assets: | ||
Cash | $27,420 | |
Accounts receivable | 1,880 | |
Inventory | 17,880 | |
Prepaid insurance | 1,200 | |
Total current assets | $48,380 | |
Property, plant, and equipment: | ||
Equipment | 28,000 | |
Less: Accumulated depreciation–Equipment | 3,200 | 24,800 |
Total assets | $73,180 | |
Liabilities and Stockholders' Equity | ||
Current liabilities: | ||
Accounts payable | 6,100 | |
Income tax payable | 425 | |
Total liabilities | 6,525 | |
Stockholders' equity: | ||
Common stock | 50,000 | |
Retained earnings | 14,200 | |
Net income | 2,455 | |
Total owners’ equity | 66,655 | |
Total liabilities and stockholders’ equity | $73,180 |
Table (29)
Want to see more full solutions like this?
Chapter 7 Solutions
FINANCIAL ACCT.:TOOLS...(LL)-W/ACCESS
- On January 1, Incredible Infants sold goods to Babies Inc. for $1,540, terms 30 days, and received payment on January 18. Which journal would the company use to record this transaction on the 18th? A. sales journal B. purchases journal C. cash receipts journal D. cash disbursements journal E. general journalarrow_forwardThe following transactions were completed by Nelsons Boutique, a retailer, during July. Terms of sales on account are 2/10, n/30, FOB shipping point. July 3Received cash from J. Smith in payment of June 29 invoice of 350, less cash discount. 6Issued Ck. No. 1718, 742.50, to Designer, Inc., for invoice. no. 2256, recorded previously for 750, less cash discount of 7.50. July 9Sold merchandise in the amount of 250 on a credit card. Sales tax on this sale is 6%. The credit card fee the bank deducted for this transaction is 5. 10Issued Ck. No. 1719, 764.40, to Smart Style, Inc., for invoice no. 1825, recorded previously on account for 780. A trade discount of 25% was applied at the time of purchase, and Smart Style, Inc.s credit terms are 2/10, n/30. 12Received 180 cash in payment of June 20 invoice from R. Matthews. No cash discount applied. 18Received 1,575 cash in payment of a 1,500 note receivable and interest of 75. 21Voided Ck. No. 1720 due to error. 25Received and paid utility bill, 152; Ck. No. 1721, payable to City Utilities Company. 31Paid wages recorded previously for the month, 2,586, Ck. No. 1722. Required 1. Journalize the transactions for July in the cash receipts journal, the general journal (for the transaction on July 9th), or the cash payments journal as appropriate. Assume the periodic inventory method is used. 2. If you are using Working Papers, total and rule the journals. Prove the equality of debit and credit totals.arrow_forwardThe following transactions were completed by Nelsons Hardware, a retailer, during September. Terms on sales on account are 1/10, n/30, FOB shipping point. Sept. 4Received cash from M. Alex in payment of August 25 invoice of 275, less cash discount. 7Issued Ck. No. 8175, 915.75, to Top Tools, Inc., for invoice. no. 2256, recorded previously for 925, less cash discount of 9.25. 10Sold merchandise in the amount of 175 on a credit card. Sales tax on this sale is 8%. The credit card fee the bank deducted for this transaction is 5. 11Issued Ck. No. 8176, 653.40, to Snap Tools, Inc. for invoice no. 726, recorded previously on account for 660. A trade discount of 15% was applied at the time of purchase, and Snap Tools, Inc.s credit terms are 1/10, n/45. 15Received 95 cash in payment of August 20 invoice from N. Johnson. No cash discount applied. 19Received 1,165 cash in payment of a 1,100 note receivable and interest of 65. 22Voided Ck. No. 8177 due to error. 26Received and paid telephone bill, 62; Ck. No. 8178, payable to Southern Telephone Company. 30Paid wages recorded previously for the month, 3,266, Ck. No. 8179. Required 1. Journalize the transactions for September in the cash receipts journal, the general journal (for the transaction on Sept. 10th), or the cash payments journal as appropriate. Assume the periodic inventory method is used. 2. If you are using Working Papers, total and rule the journals. Prove the equality of debit and credit totals.arrow_forward
- Post the following November transactions to T-accounts for Accounts Payable, Inventory, and Cash, indicating the ending balance. Assume no beginning balances in Accounts Payable and Inventory, and a beginning Cash balance of $21,220. A. purchased merchandise inventory on account, $9,900 B. paid vendors for part of inventory purchased earlier in month, $6,500 C. purchased merchandise inventory for cash, $4,750arrow_forwardToby Company had the following sales transactions for March: Mar. 6Sold merchandise on account to Osbourne, Inc., invoice no. 1128, 563.17. 14Sold merchandise on account to Ortiz Company, invoice no. 1129, 823.50. 20Sold merchandise on account to Bailey Corporation, invoice no. 1130, 2,350.98. 24Sold merchandise on account to Shannon Corporation, invoice no. 1131, 1,547.07. Assume that Toby Company had beginning balances on March 1 of 3,569.80 (Sales 411) and 2,450.39 (Accounts Receivable 113). Record the sales of merchandise on account in the sales journal (page 24) and then post to the general ledger.arrow_forwardPost the following November transactions to T-accounts for Accounts Payable and Inventory, indicating the ending balance (assume no beginning balances in these accounts). A. purchased merchandise inventory on account, $22,000 B. paid vendors for part of inventory purchased earlier in month, $14,000 C. purchased merchandise inventory for cash, $6,500arrow_forward
- The following transactions were completed by Hammond Auto Supply during January, which is the first month of this fiscal year. Terms of sale are 2/10, n/30. The balances of the accounts as of January 1 have been recorded in the general ledger in your Working Papers or in CengageNow. Hammond Auto Supply does not track cash sales by customer. Jan. 2Issued Ck. No. 6981 to JSS Management Company for monthly rent, 775. 2J. Hammond, the owner, invested an additional 3,500 in the business. 4Bought merchandise on account from Valencia and Company, invoice no. A691, 2,930; terms 2/10, n/30; dated January 2. 4Received check from Vega Appliance for 980 in payment of 1,000 invoice less discount. 4Sold merchandise on account to L. Paul, invoice no. 6483, 850. 6Received check from Petty, Inc., 637, in payment of 650 invoice less discount. 7Issued Ck. No. 6982, 588, to Fischer and Son, in payment of invoice no. C1272 for 600 less discount. 7Bought supplies on account from Doyle Office Supply, invoice no. 1906B, 108; terms net 30 days. 7Sold merchandise on account to Ellison and Clay, invoice no. 6484, 787. 9Issued credit memo no. 43 to L. Paul, 54, for merchandise returned. 11Cash sales for January 1 through January 10, 4,863.20. 11Issued Ck. No. 6983, 2,871.40, to Valencia and Company, in payment of 2,930 invoice less discount. 14Sold merchandise on account to Vega Appliance, invoice no. 6485, 2,050. Jan. 18Bought merchandise on account from Costa Products, invoice no. 7281D, 4,854; terms 2/10, n/60; dated January 16; FOB shipping point, freight prepaid and added to the invoice, 147 (total 5,001). 21Issued Ck. No. 6984, 194, to M. Miller for miscellaneous expenses not recorded previously. 21Cash sales for January 11 through January 20, 4,591. 23Issued Ck. No. 6985 to Forbes Freight, 96, for freight charges on merchandise purchased on January 4. 23Received credit memo no. 163, 376, from Costa Products for merchandise returned. 29Sold merchandise on account to Bruce Supply, invoice no. 6486, 1,835. 31Cash sales for January 21 through January 31, 4,428. 31Issued Ck. No. 6986, 53, to M. Miller for miscellaneous expenses not recorded previously. 31Recorded payroll entry from the payroll register: total salaries, 6,200; employees federal income tax withheld, 872; FICA Social Security tax withheld, 384.40, FICA Medicare tax withheld, 89.90. 31Recorded the payroll taxes: Social Security tax, 384.40, FICA Medicare tax, 89.90; state unemployment tax, 334.80; federal unemployment tax, 37.20. 31Issued Ck. No. 6987, 4,853.70, for salaries for the month. 31J. Hammond, the owner, withdrew 1,000 for personal use, Ck. No. 6988. Required 1. Record the transactions for January using a sales journal, page 73; a purchases journal, page 56; a cash receipts journal, page 38; a cash payments journal, page 45; and a general journal, page 100. Assume the periodic inventory method is used. 2. Post daily all entries involving customer accounts to the accounts receivable ledger. 3. Post daily all entries involving creditor accounts to the accounts payable ledger. 4. Post daily those entries involving the Other Accounts columns and the general journal to the general ledger. Write the owners name in the Capital and Drawing accounts. 5. Add the columns of the special journals and prove the equality of the debit and credit totals. 6. Post the appropriate totals of the special journals to the general ledger. 7. Prepare a trial balance. 8. Prepare a schedule of accounts receivable and a schedule of accounts payable. Do the totals equal the balances of the related controlling accounts?arrow_forwardThe following transactions were completed by Hammond Auto Supply during January, which is the first month of this fiscal year. Terms of sale are 2/10, n/30. The balances of the accounts as of January 1 have been recorded in the general ledger in your Working Papers or in CengageNow. Hammond Auto Supply does not track cash sales by customer. Jan. 2Issued Ck. No. 6981 to JSS Management Company for monthly rent, 775. 2J. Hammond, the owner, invested an additional 3,500 in the business. 4Bought merchandise on account from Valencia and Company, invoice no. A691, 2,930; terms 2/10, n/30; dated January 2. 4Received check from Vega Appliance for 980 in payment of 1,000 invoice less discount. 4Sold merchandise on account to L. Paul, invoice no. 6483, 850. 6Received check from Petty, Inc., 637, in payment of 650 invoice less discount. 7Issued Ck. No. 6982, 588, to Fischer and Son, in payment of invoice no. C1272 for 600 less discount. 7Bought supplies on account from Doyle Office Supply, invoice no. 1906B, 108; terms net 30 days. 7Sold merchandise on account to Ellison and Clay, invoice no. 6484, 787. 9Issued credit memo no. 43 to L. Paul, 54, for merchandise returned. 11Cash sales for January 1 through January 10, 4,863.20. 11Issued Ck. No. 6983, 2,871.40, to Valencia and Company, in payment of 2,930 invoice less discount. 14Sold merchandise on account to Vega Appliance, invoice no. 6485, 2,050. Jan. 18Bought merchandise on account from Costa Products, invoice no. 7281D, 4,854; terms 2/10, n/60; dated January 16; FOB shipping point, freight prepaid and added to the invoice, 147 (total 5,001). 21Issued Ck. No. 6984, 194, to M. Miller for miscellaneous expenses not recorded previously. 21Cash sales for January 11 through January 20, 4,591. 23Issued Ck. No. 6985 to Forbes Freight, 96, for freight charges on merchandise purchased on January 4. 23Received credit memo no. 163, 376, from Costa Products for merchandise returned. 29Sold merchandise on account to Bruce Supply, invoice no. 6486, 1,835. 31Cash sales for January 21 through January 31, 4,428. 31Issued Ck. No. 6986, 53, to M. Miller for miscellaneous expenses not recorded previously. 31Recorded payroll entry from the payroll register: total salaries, 6,200; employees federal income tax withheld, 872; FICA Social Security tax withheld, 384.40, FICA Medicare tax withheld, 89.90. 31Recorded the payroll taxes: Social Security tax, 384.40, FICA Medicare tax, 89.90; state unemployment tax, 334.80; federal unemployment tax, 37.20. 31Issued Ck. No. 6987, 4,853.70, for salaries for the month. 31J. Hammond, the owner, withdrew 1,000 for personal use, Ck. No. 6988. Required 1. Record the transactions in the general journal for January. If you are using Working Papers, start with page 1 in the journal. Assume the periodic inventory method is used. The chart of accounts is as follows: 2. Post daily all entries involving customer accounts to the accounts receivable ledger. 3. Post daily all entries involving creditor accounts to the accounts payable ledger. 4. Post daily the general journal entries to the general ledger. Write the owners name in the Capital and Drawing accounts. 5. Prepare a trial balance. 6. Prepare a schedule of accounts receivable and a schedule of accounts payable. Do the totals equal the balances of the related controlling accounts?arrow_forwardThe transactions completed by Revere Courier Company during December 2016, the first month of the fiscal year, were as follows: Instructions 1. Enter the following account balances in the general ledger as of December 1: 2. Journalize the transactions for December 2016, using the following journals similar to those illustrated in this chapter: cash receipts journal (p. 31), purchases journal (p. 37, with columns for Accounts Payable, Maintenance Supplies, Office Supplies, and Other Accounts), single-column revenue journal (p. 35), cash payments journal (p. 34), and two-column general journal (p. 1). Assume that the daily postings to the individual accounts in the accounts payable subsidiary ledger and the accounts receivable subsidiary ledger have been made. 3. Post the appropriate individual entries to the general ledger. 4. Total each of the columns of the special journals, and post the appropriate totals to the general ledger; insert the account balances. 5. Prepare a trial balance.arrow_forward
- Post the following July transactions to T-accounts for Accounts Receivable, Sales Revenue, and Cash, indicating the ending balance. Assume no beginning balances in these accounts. A. on first day of the month, sold products to customers for cash, $13,660 B. on fifth day of month, sold products to customers on account, $22,100 C. on tenth day of month, collected cash from customer accounts, $18,500arrow_forwardThe purchases journal for Newmark Exterior Cleaners Inc. follows. The accounts payable account has a March 1, 2016, balance of 580 for an amount owed to Nicely Co. There were no payments 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. e. How might a computerized accounting system differ from the use of a purchases journal in recording purchase transactions?arrow_forwardThe transactions completed by AM Express Company during March 2016, the first month of the fiscal year, were as follows: Instructions 1. Enter the following account balances in the general ledger as of March 1: 2. Journalize the transactions for March 2016, using the following journals similar to those illustrated in this chapter: single-column revenue journal (p. 35), cash receipts journal (p. 31), purchases journal (p. 37, with columns for Accounts Payable, Maintenance Supplies, Office Supplies, and Other Accounts), cash payments journal (p. 34), and two-column general journal (p. 1). Assume that the daily postings to the individual accounts in the accounts payable subsidiary ledger and the accounts receivable subsidiary ledger have been made. 3. Post the appropriate individual entries to the general ledger. 4. Total each of the columns of the special journals, and post the appropriate totals to the general ledger; insert the account balances. 5. Prepare a trial balance.arrow_forward
- College Accounting (Book Only): A Career ApproachAccountingISBN:9781337280570Author:Scott, Cathy J.Publisher:South-Western College PubPrinciples of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax CollegeFinancial AccountingAccountingISBN:9781337272124Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning
- Financial AccountingAccountingISBN:9781305088436Author:Carl Warren, Jim Reeve, Jonathan DuchacPublisher:Cengage LearningCornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage LearningCollege Accounting, Chapters 1-27AccountingISBN:9781337794756Author:HEINTZ, James A.Publisher:Cengage Learning,