College Accounting (Book Only): A Career Approach
College Accounting (Book Only): A Career Approach
13th Edition
ISBN: 9781337280570
Author: Scott, Cathy J.
Publisher: South-Western College Pub
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Textbook Question
Chapter 9, Problem 3PB

May’s Beauty Store records sales and purchase transactions in the general journal. In addition to a general ledger, May’s Beauty Store also uses an accounts receivable ledger and an accounts payable ledger. Transactions for January related to the sales and purchase of merchandise are as follows:

Jan. 2    Bought nine Matte Nail Color Kits from Mejia, Inc., $450, invoice no. 4521, dated January 1; terms 2/10, n/30; FOB shipping point, freight prepaid and added to the invoice, $87.50 (total $537.50).

5    Bought 30 Perfume Cocktail Rings from Braun, Inc., $1,200, invoice no. 37A, dated January 3; terms 2/10, n/30; FOB destination.

8    Sold two Matte Nail Color Kits on account to J. Herbert, sales slip no. 113, $110, plus sales tax of $8.80, total $118.80.

11    Received credit memo no. 455 from Braun, Inc., for merchandise returned, $315.25.

18    Bought 15 Eye Palettes from Vargas, Inc., $660, invoice no. 910, dated January 14; terms net 30; FOB destination.

23    Sold four Eye Palettes on account to T. Cantrell, sales slip no. 114, $200, plus sales tax of $16, total $216.

26    Issued credit memo no. 12 to T. Cantrell for merchandise returned, $50 plus $4 sales tax, total $54.

Required

  1. 1. If using Working Papers, open the following accounts in the accounts receivable ledger and record the balances as of January 1: T. Cantrell, $86.99; J. Hebert, $63.47. Write Balance in the Item column and place a check mark in the Post. Ref. column. Skip this step if using CengageNow.
  2. 2. If using Working Papers, open the following accounts in the accounts payable ledger and record the balances as of January 1: Braun, Inc., $513.20; Mejia, Inc., $113.40; Vargas, Inc., $67.15. Write Balance in the Item column and place a check mark in the Post. Ref. column. Skip this step if using CengageNow.
  3. 3. If using Working Papers, record the January 1 balances in the general ledger as given: Accounts Receivable 113 controlling account, $150.46; Accounts Payable 212 controlling account, $693.75; Sales Tax Payable 214, $237.89. Write Balance in the Item column and place a check mark in the Post. Ref. column. Skip this step if using CengageNow.
  4. 4. Record the transactions in the general journal. If using Working Papers, begin on page 17.
  5. 5. Post the entries to the general ledger and accounts receivable ledger or accounts payable ledger as appropriate.
  6. 6. Prepare a schedule of accounts receivable.
  7. 7. Prepare a schedule of accounts payable.
  8. 8. Compare the totals of the schedules with the balances of the controlling accounts.

4.

Expert Solution
Check Mark
To determine

Prepare journal entry to record the given transaction.

Explanation of Solution

Merchandise Inventory:

Merchandise is the stock of goods bought by a wholesaler, or a retailer, or a trader, to be sold within a year. Merchandise Inventory is a current asset account which includes all the costs incurred to acquire merchandise, and process it further for sale.

Date Account Titles and explanation Post.Ref Debit ($) Credit ($)
January2 Purchase 511 450.00  
  Freight in 514 87.50  
       Accounts payable 212   537.50
  (To record the purchase of merchandise from the Company M, invoice no.4521 terms n/30)      
         
January 5 Purchase 511 1,200.00  
       Accounts payable 212   1,200.00
  (To record the purchase of merchandise from the Company B, invoice no.37A terms n/30)      
         
January8 Accounts receivable 113 118.80  
       Sales 411   110.00
       Sales tax payable 214   80.00
  (To record the sale of merchandise to Company H,  sales slip no.113)      
         
January11 Accounts payable 212 315.25  
       Purchase returns and allowance 512   315.25
  (To record the credit memo no.455 for return of  merchandise)      
         
January18 Purchase 511 660.00  
       Accounts payable 212   660.00
  (To record the purchase of merchandise from the Company V, invoice no. 910 terms net 30)      
         
January23 Accounts receivable 113 216.00  
       Sales 411   200.00
       Sales tax payable 214   16.00
  (To record the sale of merchandise to Company C,  sales slip no.114)      
         
January26 Sales returns and allowances 412 50.00  
  Sales tax payable 214 4.00  
       Accounts receivable 113   54.00
  (To record the issuance of credit memo no.12)      

Table (1)

1 , 2 ,3 and 5

Expert Solution
Check Mark
To determine

Enter the opening balance, post the transactions and close the balance of the respective accounts in the general ledger and accounts payable ledger and accounts receivable ledger.

Explanation of Solution

                                   Accounts Receivable                    Account  No: 113
Date Item Post ref. Debit Credit Balance
Debit Credit
January 1 Balance       150.46  
  8     118.80   269.26  
  23     216.00   485.26  
  26       54.00 431.26  

Table (2)

                                   Accounts Payable                   Account  No: 212
Date Item Post ref. Debit Credit Balance
Debit Credit
January 1 Balance         693.75
  2       537.50   1,231.25
  5       1,200.00   2,431.25
  11     315.25     2,116.00
  18       660.00   2,776.00

Table (3)

                                   Sales tax payable                 Account  No: 214
Date Item Post ref. Debit Credit Balance
Debit Credit
January 1 Balance         237.89
  8       8.80   246.69
  23       16.00   262.69
  26      4.00     258.69

Table (4)

                                   Sales                                           Account  No: 411
Date Item Post ref. Debit Credit Balance
Debit Credit
January 8       110.00   110.00
  23       200.00   310.00

Table (5)

                                   Sales returns and allowance               Account  No: 412
Date Item Post ref. Debit Credit Balance
Debit Credit
January 26     50.00   50.00  
             

Table (6)

                                   Purchase                                 Account  No: 511
Date Item Post ref. Debit Credit Balance
Debit Credit
January 2     450.00   450.00  
  5     1,200.00   1,650.00  
  18     660.00   2,310.00  

Table (7)

                 Purchase returns and allowance           Account  No: 512
Date Item Post ref. Debit Credit Balance
Debit Credit
January 11       315.25   315.25
               
               

Table (8)

                                       Freight  In                                 Account  No: 514
Date Item Post ref. Debit Credit Balance
Debit Credit
January 2      87.50   87.50  
               
               

Table (9)

Accounts receivable ledger
Name : Company S
Date Item Post Ref. Debit Credit Balance
January 1 Balance        86.99
  23     216.00   302.99
   26       54.00 248.99

Table (10)

Accounts receivable ledger
Name : Company H
Date Item Post Ref. Debit Credit Balance
January 1       63.47
  8     118.80   182.27

Table (11)

Accounts payable ledger
Name : Company B
Date Item Post Ref. Debit Credit Balance
January 1 Balance        513.20
  5       1,200.00 1,713.20
   11     315.25   1,397.95

Table (12)

Accounts payable ledger
Name : Company M
Date Item Post Ref. Debit Credit Balance
January 1       113.40
  2       537.50 650.90

Table (13)

Accounts payable ledger
Name : Company V
Date Item Post Ref. Debit Credit Balance
January 1       67.15
  18       660.00 727.15

 Table (14)

6, 7 and 8

Expert Solution
Check Mark
To determine

Prepare Company M’s schedule of accounts receivable, accounts payable and compare the total with accounts receivable controlling ledger and accounts payable controlling ledger.

Explanation of Solution

Prepare Company M’s schedule of accounts receivable and accounts payable:

Company M
Schedule of accounts receivable
January 31,20--
Particulars Amount  in $
Company C 248.99
Company H 182.27
Total accounts receivable 431.26

Table (15)

Company M
Schedule of accounts payable
January 31,20--
Particulars Amount  in $
Company B 1,397.95
Company M 650.90
Company V 727.15
Total accounts receivable 2,776.00

Table (16)

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Chapter 9 Solutions

College Accounting (Book Only): A Career Approach

Ch. 9 - What is the difference between a wholesale...Ch. 9 - For each of the following accounts, identify...Ch. 9 - Prob. 3DQCh. 9 - Why is an accounts receivable ledger or an...Ch. 9 - Why is it a good practice to post daily to the...Ch. 9 - Prob. 6DQCh. 9 - Prob. 7DQCh. 9 - Prob. 8DQCh. 9 - Prob. 9DQCh. 9 - Prob. 10DQCh. 9 - Prob. 11DQCh. 9 - Prob. 12DQCh. 9 - Record the following transactions in general...Ch. 9 - Post the following entry to the general ledger and...Ch. 9 - Record the following transactions in general...Ch. 9 - Journalize the following transactions in general...Ch. 9 - Post the following entry to the general ledger and...Ch. 9 - Record the following transactions in general...Ch. 9 - Record the following transactions for a perpetual...Ch. 9 - Toby Company had the following sales transactions...Ch. 9 - Williams Corporation had the following purchases...Ch. 9 - Kelley Company has completed the following October...Ch. 9 - Bell Florists sells flowers on a retail basis....Ch. 9 - Berrys Pet Store records purchase transactions in...Ch. 9 - Shirleys Beauty Store records sales and purchase...Ch. 9 - The following transactions relate to Hawkins,...Ch. 9 - Gomez Company sells electrical supplies on a...Ch. 9 - Patterson Appliance uses a three-column purchases...Ch. 9 - Prob. 1PBCh. 9 - Lowerys Pet Depot records purchase transactions in...Ch. 9 - Mays Beauty Store records sales and purchase...Ch. 9 - The following transactions relate to Khan, Inc., a...Ch. 9 - Prob. 5PBCh. 9 - West Bicycle Shop uses a three-column purchases...Ch. 9 - Prob. 1ACh. 9 - You are the bookkeeper at a small merchandising...Ch. 9 - Following is a trial balance prepared just before...Ch. 9 - Sales and Purchases Ms. Valli of All About You Spa...
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  • Review the following transactions and prepare any necessary journal entries for Tolbert Enterprises. A. On April 7, Tolbert Enterprises contracts with a supplier to purchase 300 water bottles for their merchandise inventory, on credit, for $10 each. Credit terms are 2/10, n/60 from the invoice date of April 7. B. On April 15, Tolbert pays the amount due in cash to the supplier.
    Preston 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: Required 1. Journalize the transactions for May in the cash receipts journal and the sales journal. Assume the periodic inventory method is used. 2. If you are using Working Papers, total and rule the journals and prove the equality of the debit and credit totals.
    Patterson Appliance uses a three-column purchases journal. The company is located in Fresno, California. In addition to a general ledger, Patterson Appliance also uses an accounts payable ledger. Transactions for January related to the purchase of merchandise are as follows: Jan. 2 Bought eighty 12-inch, 3-speed Brighton Oscillating Fans from Snyder and Jordan, 1,890, invoice no. 268J, dated January 2; terms net 60 days; FOB Fresno. 4 Bought ten 35-pint-capacity Crystal Humidifiers from Simpson Company, 2,300, invoice no. 39426, dated January 2; terms 2/10, n/30; FOB Durango, freight prepaid and added to the invoice, 90 (total 2,390). 7 Bought ten 16-inch Axel Window Fans from Tran, Inc., 360, invoice no. 452AD, dated January 6; terms 1/10, n/30; FOB Fresno. 10 Bought twenty-four 4-blade Tiempo Ceiling Fans, Model 2760, from Ukele Company, 3,550, invoice no. D7742, dated January 7; terms 2/10, n/30; FOB Sacramento, freight prepaid and added to the invoice, 84 (total 3,634). 14 Bought four Charger Electric Hedge Trimmers from Fernandez Products Company, 186, invoice no. 2542, dated January 13; terms net 30 days; FOB Fresno. 22 Bought 40 Lindon Electric Bug Killers from Snyder and Jordan, 2,265, invoice no. 392J, dated January 22; terms net 60 days; FOB Fresno. 28 Bought ten Charger Electric Blowers from Fernandez Products Company, 830, invoice no. 2691, dated January 27; terms net 30 days; FOB Fresno. 30 Bought ten Kole Powered Attic Ventilators from Porter Company, 446, invoice no. 664CC, dated January 27; terms 2/10, n/30; FOB Seattle, freight prepaid and added to the invoice, 48 (total 494). Required 1. If using Working Papers, open the following accounts in the accounts payable ledger and record the January 1 balances, if any, as given: Fernandez Products Company; Porter Company, 163.17; Simpson Company, 167.19; Snyder and Jordan; Tran, Inc., 228.70; Ukele Company. For the accounts having balances, write Balance in the Item column and place a check mark in the Post. Ref. column. Skip this step if using CengageNow or CLGL. 2. If using Working Papers, record the balance of 559.06 in the Accounts Payable 212 controlling account as of January 1. Write Balance in the Item column and place a check mark in the Post. Ref. column. Skip this step if using CengageNow or CLGL. 3. Record the transactions in the purchases journal. If using Working Papers, begin on page 81. 4. Post to the accounts payable ledger daily. Skip this step if using CLGL. 5. Post to the general ledger at the end of the month. Skip this step if using CLGL. 6. Prepare a schedule of accounts payable and compare the balance of the Accounts Payable controlling account with the total of the schedule of accounts payable.
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