DISCUSSION QUESTIONS. Suggested Responses

Transcription

1 DISCUSSION QUESTIONS Suggested Responses 1. A wholesale business buys goods from manufacturers and sells them to retailers. A wholesaler is sometimes referred to as a middleman. A retail business buys goods either from a manufacturer or a wholesaler and then sells those goods directly to consumers. 2. a. Sales Returns and Allowances debit, contra account b. Merchandise Inventory debit c. Sales credit d. Freight In debit e. Purchases Returns and Allowances credit, contra account f. Sales Tax Payable credit g. Sales Discounts debit, contra account h. Purchases debit i. Purchases Discounts credit, contra account 3. a. A schedule of accounts receivable serves as a verification of the accuracy of the accounts receivable ledger; the schedule s total must equal the balance of the Accounts Receivable (controlling) account in the general ledger. b. A schedule of accounts payable serves as a verification of the accuracy of the accounts payable ledger; the schedule s total must equal the balance of the Accounts Payable (controlling) account in the general ledger. 4. Having an accounts receivable ledger and/or an accounts payable ledger is necessary because including individual accounts in the general ledger would result in an overly long trial balance. For the purposes of extending credit and collecting the amount owed, a business uses an accounts receivable ledger to keep track of how much each individual customer currently owes. Similarly, companies maintain an accounts payable ledger to keep track of what they owe to vendors/suppliers and to make certain that charges and payments are correct. 5. Posting to the accounts receivable ledger and the accounts payable ledger on a daily basis is necessary to keep management and customer service fully informed of the amounts customers owe the company and the amounts the company owes to creditors. 6. A sales return and allowance relates to either a physical return of the goods by a customer to a business or the business s reduction (an allowance) in the original price of the goods to the customer because the goods were defective or damaged. A purchases return and allowance relates to either the company s return of goods to a vendor/supplier or a reduction in the cost (an allowance) of the goods by the vendor/supplier because the goods arrived in damaged condition. 7. FOB destination means that the seller pays all the freight charges on the goods being transported. While the goods are in transit, the seller retains title to the goods. FOB shipping point means that the buyer pays all the freight charges on the goods being transported. In the event that the seller pays for the freight charges in advance, the buyer is responsible for reimbursing the seller. While the goods are in transit, the buyer has title to the goods. 8. The internal control of purchases generally involves the following measures: a. Purchases are made only after proper authorization is given. Purchase requisitions and purchase orders are all prenumbered, so that each form can be accounted for Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

2 b. The receiving department carefully checks all goods upon receipt for count, damages, and description. Later, the report of the receiving department is verified against the purchase order and the purchase invoice. c. The person who authorizes the payment is neither the person doing the ordering nor the person actually writing the check. Payment is authorized only after verifying the purchase invoice data with the receiving report and purchase order. d. The person who actually writes the check has not been involved in any of the foregoing purchasing procedures. 9. a. Post the total to the general ledger as a debit to Accounts Receivable and a credit to Sales, placing S followed by the sales journal page number in the Post. Ref. column. After posting to each of these accounts, record the account number below the total, placing the number for Accounts Receivable in parentheses on the left and the account number for Sales in parentheses on the right. Draw a single line across the amount column above the total. Below the column total, extend double underlines through the Date column, the Post. Ref. column, and the amount column. Write the last day of the month on the line with the total. b. Post the totals to the general ledger as a credit to Accounts Payable and a debit to Purchases and to Freight In, placing P followed by the purchases journal page number in the Post. Ref. column. After posting to each of these accounts, record the account number below the total, placing the numbers for Accounts Payable, Freight In, and Purchases in parentheses. Draw a single line across the amount column above the total. Below the column total, extend double underlines through the Date column, the Post. Ref. column, and the amount columns. Write the last day of the month on the line with the total. 10. a. Post individual amounts to the credit customer accounts in the accounts receivable ledger on a daily basis. In the Post. Ref. column, place an S followed by the sales journal page number. After posting each entry to the accounts receivable ledger, put a check mark in the Post. Ref. column of the sales journal. b. Post the individual amounts to the vendor/supplier accounts in the accounts payable ledger on a daily basis. In the Post. Ref. column, place a P followed by the purchases journal page number. After posting each entry to the accounts payable ledger, put a check mark in the Post. Ref. column of the purchases journal Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 363

3 SOLUTIONS TO EXERCISES Exercise 9-1 GENERAL JOURNAL PAGE DESCRIPTION 1 a. Accounts Receivable, G. Frank 1, Sales 1, Sold merchandise to 3 4 G. Frank, invoice no b. Accounts Receivable, Gregory 6 7 Productions Sales Sold merchandise on 9 10 account, invoice no c. Sales Returns and Allowances Accounts Receivable, Gregory Productions Issued credit memo no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

4 Exercise 9-2 GENERAL JOURNAL PAGE 52 DESCRIPTION June 16 Sales Returns and Allowances Accounts Receivable, F. E. Dixon 113/ Issued credit memo no GENERAL LEDGER Accounts Receivable NO. 113 June 1 Balance 6, J , Sales Returns and Allowances NO. 412 June 1 Balance J F. E. Dixon 416 Fifth Avenue Dallas, TX S RECEIVABLE LEDGER May 31 J June 16 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 365

5 Exercise 9-3 a. Sold merchandise on account, $ plus $67.50 sales tax. b. Customer returned merchandise that had a selling price of $ Credited customer s account for $49.95 plus $3.75 sales tax. Exercise 9-4 GENERAL JOURNAL PAGE DESCRIPTION 1 a. Accounts Receivable, A. Bauer Sales Sales Tax Payable Sold merchandise to A. Bauer, 4 5 invoice no. D b. Sales Returns and Allowances Sales Tax Payable Accounts Receivable, A. Bauer Issued credit memo no Exercise 9-5 a. Purchased merchandise on account, $1,100; freight prepaid and added to the invoice, $84 (total $1,184). b. Returned $120 of merchandise previously purchased on account. Exercise 9-6 GENERAL JOURNAL PAGE DESCRIPTION 1 a. Purchases Accounts Payable, Brewer, Inc Purchased merchandise from 3 4 Brewer, Inc., invoice no. B2997, 4 5 terms n/ b. Accounts Payable, Brewer, Inc Purchases Returns and Allowances Credit memo no. 96 for return 9 10 of merchandise Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

6 Exercise 9-7 GENERAL JOURNAL PAGE 92 DESCRIPTION July 14 Accounts Payable, Jensen and Silva 212/ Purchases Returns and Allowances Credit memo no. 942 for return 4 5 of merchandise Accounts Payable GENERAL LEDGER NO. 212 July 1 Balance 2, J , Purchases Returns and Allowances NO. 512 July 1 Balance J Jensen and Silva 542 Roselle Blvd. Chicago, IL S PAYABLE LEDGER June 13 J July 14 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 367

7 Exercise 9-8 Ford Education Outfitters DESCRIPTION GENERAL JOURNAL PAGE 1 a. Purchases 1, Accounts Payable, Romero 2 3 Textbooks, Inc. 1, Purchased merchandise from 4 5 Romero Textbooks, Inc., 5 6 invoice no , terms n/ b. Accounts Payable, Romero 8 9 Textbooks, Inc Purchases Returns and Allowances Credit memo no. 513A for return of merchandise Romero Textbooks, Inc. GENERAL JOURNAL PAGE DESCRIPTION 1 a. Accounts Receivable, Ford Education 1 2 Outfitters 1, Sales 1, Sold merchandise to Ford 4 5 Education Outfitters, 5 6 invoice no Delivery Expense Cash b. Sales Returns and Allowances Accounts Receivable, Ford Education Outfitters Issued credit memo no. 513A Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

8 Exercise 9-9 Chang Electronics GENERAL JOURNAL PAGE DESCRIPTION Nov. 6 Sales Returns and Allowances Accounts Receivable, The 3 4 Merchandise Market Issued credit memo no The Merchandise Market GENERAL JOURNAL PAGE DESCRIPTION Nov. 6 Accounts Payable, Chang Electronics Purchases Returns and 3 4 Allowances Credit memo no. 121 for return 5 6 of merchandise Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 369

9 Exercise 9-10 SALES JOURNAL PAGE 24 INV. NO. CUSTOMER'S S RECEIVABLE DR. SALES CR Mar Osbourne, Inc Ortiz Company Bailey Corporation 2, Shannon Corporation 1, Total 5, (113) (411) GENERAL LEDGER Accounts Receivable NO. 113 Mar. 1 Balance 31 S24 5, , , Sales NO. 411 Mar. 1 Balance 3, S24 5, , Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

10 Exercise 9-11 PURCHASES JOURNAL 13 SUPPLIER'S INV. NO. INV. TERMS S PAYABLE FREIGHT IN PURCHASES May 3 Owens Company J34Y9 5/1 n/ Lionel's Lawn & Landscaping R7740 5/9 2/10, n/ Wright's Farm Supplies 478 5/13 n/ Gutierrez Corporation /22 n/ Totals 1, , (212) (514) (511) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 371

11 Exercise 9-11 (concluded) Accounts Payable GENERAL LEDGER NO. 212 May 1 Balance 3, P13 1, , Purchases NO. 511 May 1 Balance 4, P13 1, , Freight In NO. 514 May 1 Balance P Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

12 Exercise 9-12 SALES JOURNAL PAGE 18 INV. NO. CUSTOMER'S S RECEIVABLE DR. SALES CR Oct Anderson Company R. T. Holcomb 1, Gray and Malo 1, Mercer Mobil 3, J. L. Anthony 2, C. A. Goldschmidt 1, F. A. Baumann 2, Total 13, (113) (411) PURCHASES JOURNAL PAGE 10 SUPPLIER'S INV. INV. NO. TERMS S PAYABLE FREIGHT IN PURCHASES Oct. 2 Colter, Inc /31 2/10, n/ Thomas and Son 982 8/2 n/ Archer Mfg. Co /3 2/10, n/ Spence Products Co. B643 8/6 1/10, n/ L. C. Walter /17 n/ Delaney and Cox /23 2/10, n/ Colter, Inc /25 2/10, n/ Totals 3, , (212) (514) (511) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 373

13 Exercise 9-12 (continued) S RECEIVABLE LEDGER Anderson Company J. L. Anthony F. A. Baumann , , C. A. Goldschmidt Gray and Malo R. T. Holcomb Mercer Mobil , , , , GENERAL LEDGER Accounts Receivable 113 Accounts Payable 212 Sales , , , Purchases , Freight In S PAYABLE LEDGER Archer Mfg. Co. Colter, Inc. Delaney and Cox Bal. 1, Spence Products Co. Thomas and Son L. C. Walter Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

14 Exercise 9-12 (concluded) Kelley Company Schedule of Accounts Receivable October 31, Anderson Company J. L. Anthony F. A. Baumann C. A. Goldschmidt Gray and Malo $ , , , , R. T. Holcomb Mercer Mobil 1, , Total Accounts Receivable $13, Kelley Company Schedule of Accounts Payable October 31, Archer Manufacturing Co. Colter, Inc. Delaney and Cox Spence Products Co. Thomas and Son L. C. Walter Total Accounts Payable $ , $3, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 375

15 Problem 9-1A DESCRIPTION GENERAL JOURNAL PAGE Mar. 4 Accounts Receivable, C. Morales 113/ Sales Sales Tax Payable Sold merchandise to C. Morales, 5 6 sales slip no Accounts Receivable, R. Dixon 113/ Sales Sales Tax Payable Sold merchandise to R. Dixon, sales slip no Accounts Receivable, B. Cox 113/ Sales Sales Tax Payable Sold merchandise to B. Cox, sales slip no Accounts Receivable, All-Star Legion 113/ Sales Sales Tax Payable Sold merchandise to All-Star Legion, sales slip no Accounts Receivable, Tucker Funeral Home 113/ Sales Sales Tax Payable Sold merchandise to Tucker Funeral Home, sales slip no Sales Returns and Allowances Sales Tax Payable Accounts Receivable, Tucker Funeral Home 113/ Issued credit memo no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

16 Problem 9-1A (continued) GENERAL JOURNAL PAGE 58 DESCRIPTION Mar. 23 Accounts Receivable, Price Savings 2 3 and Loan Association 113/ Sales Sales Tax Payable Sold merchandise to Price 6 7 Savings and Loan Association, 7 8 sales slip no Sales Returns and Allowances Sales Tax Payable Accounts Receivable, Price Savings and Loan Association 113/ Issued credit memo no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 377

17 Problem 9-1A (continued) GENERAL LEDGER Accounts Receivable NO. 113 Mar. 1 Balance J J J J J J J J Sales Tax Payable NO. 214 Mar. 1 Balance J J J J J J J J Sales NO. 411 Mar. 4 J J J J J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

18 Problem 9-1A (continued) Sales Returns and Allowances NO. 412 Mar. 21 J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 379

19 Problem 9-1A (continued) All-Star Legion S RECEIVABLE LEDGER Mar. 1 Balance J B. Cox Mar. 12 J R. Dixon Mar. 6 J C. Morales Mar. 1 Balance J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

20 Problem 9-1A (concluded) Price Savings and Loan Association Mar. 1 Balance J J Tucker Funeral Home Mar. 18 J J Bell Florists Schedule of Accounts Receivable March 31, All-Star Legion B. Cox R. Dixon C. Morales Price Savings and Loan Association Tucker Funeral Home Total Accounts Receivable $ $ Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 381

21 Problem 9-2A DESCRIPTION GENERAL JOURNAL PAGE Apr. 2 Purchases Accounts Payable, Blackburn Company 212/ Purchased merchandise from 4 5 Blackburn Company, invoice no R48, invoice dated 4/1, terms 6 7 n/ Purchases Freight In Accounts Payable, Herrera Company 212/ Purchased merchandise from Herrera Company, invoice no , invoice dated 4/3, terms /10, n/ Purchases Accounts Payable, Barrett, Inc. 212/ Purchased merchandise from Barrett, Inc., invoice no. 1845R, invoice dated 4/5, terms 1/10, n/ Purchases 511 1, Freight In Accounts Payable, Faulkner Company 212/ 1, Purchased merchandise from Faulkner Company, invoice no , invoice dated 4/7, terms /10, n/ Accounts Payable, Faulkner Company 212/ Purchases Returns and Allowances Credit memo no. 415 for return of merchandise Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

22 Problem 9-2A (continued) DESCRIPTION GENERAL JOURNAL PAGE Apr. 23 Purchases 511 1, Accounts Payable, Rhodes 3 4 Manufacturing 212/ 1, Purchased merchandise from 5 6 Rhodes Manufacturing, invoice 6 7 no. 246J, invoice dated 4/21, 7 8 terms net Purchases Accounts Payable, Solomon Products Company 212/ Purchased merchandise from Solomon Products Company, invoice no. 2675, invoice dated /25, terms net Accounts Payable, Solomon Products Company 212/ Purchases Returns and Allowances Credit memo no. 861 for return of merchandise Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 383

23 Problem 9-2A (continued) GENERAL LEDGER Accounts Payable NO. 212 Apr. 1 Balance 3, J , J , J , J115 1, , J , J116 1, , J , J , Purchases NO. 511 Apr. 1 Balance J J , J , J115 1, , J116 1, , J , Purchases Returns and Allowances NO. 512 Apr. 1 Balance J J Freight In NO. 514 Apr. 1 Balance J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

24 Problem 9-2A (continued) Barrett, Inc. S PAYABLE LEDGER Apr. 1 Balance J Blackburn Company Apr. 1 Balance J Faulkner Company Apr. 1 Balance J115 1, , J , Herrera Company Apr. 5 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 385

25 Problem 9-2A (concluded) Rhodes Manufacturing Apr. 1 Balance J116 1, , Solomon Products Company Apr. 1 Balance 1, J , J , Berry's Pet Store Schedule of Accounts Payable April 30, Barrett, Inc. Blackburn Company Faulkner Company Herrera Company Rhodes Manufacturing Solomon Products Company Total Accounts Payable $ , , , $7, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

26 Problem 9-3A GENERAL JOURNAL PAGE 25 DESCRIPTION Jan. 3 Purchases Freight In Accounts Payable, Madden, Inc. 212/ Purchased merchandise from 5 6 Madden, Inc., invoice no. 3487, 6 7 invoice dated 1/1, terms 2/10, n/ Purchases Accounts Payable, Calhoun Candles, Inc. 212/ Purchased merchandise from Calhoun Candles, Inc., invoice no , invoice dated 1/1, terms net Accounts Receivable, R. Kielman 113/ Sales Sales Tax Payable Sold merchandise to R. Kielman, sales slip no Accounts Payable, Calhoun Candles, Inc. 212/ Purchases Returns and Allowances Credit memo no for return of merchandise Purchases Accounts Payable, Whitney and Waters 212/ Purchased merchandise from Whitney and Waters, invoice no A875, invoice dated 1/18, terms /15, n/ Accounts Receivable, A. Benner 113/ Sales Sales Tax Payable Sold merchandise to A. Benner, sales slip no Sales Returns and Allowances Sales Tax Payable Accounts Receivable, A. Benner 113/ Issued credit memo no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 387

27 Problem 9-3A (continued) GENERAL LEDGER Accounts Receivable NO. 113 Jan. 1 Balance J J J Accounts Payable NO. 212 Jan. 1 Balance J , J , J , J , Sales Tax Payable NO. 214 Jan. 1 Balance J J J Sales NO. 411 Jan. 12 J J Sales Returns and Allowances NO. 412 Jan. 27 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

28 Problem 9-3A (continued) Purchases NO. 511 Jan. 3 J J , J , Purchases Returns and Allowances NO. 512 Jan. 13 J Freight In NO. 514 Jan. 3 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 389

29 Problem 9-3A (continued) A. Benner S RECEIVABLE LEDGER Jan. 1 Balance J J R. Kielman Jan. 1 Balance J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

30 Problem 9-3A (continued) S PAYABLE LEDGER Calhoun Candles, Inc. Jan. 1 Balance J J Madden, Inc. Jan. 1 Balance J , Whitney and Waters Jan. 1 Balance J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 391

31 Problem 9-3A (concluded) Shirley's Beauty Store Schedule of Accounts Receivable January 31, A. Benner R. Kielman Total Accounts Receivable $ $ Shirley's Beauty Store Schedule of Accounts Payable January 31, Calhoun Candles, Inc. Madden, Inc. Whitney and Waters Total Accounts Payable $ , $2, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

32 Problem 9-4A SALES JOURNAL PAGE 39 INV. NO. CUSTOMER'S S RECEIVABLE DR. SALES CR Apr Myers Company L. R. Foster Company Diaz Hardware Brooks and Bennett Powell and Reyes Ortiz Company Diaz Hardware Total 4, (113) (411) GENERAL JOURNAL PAGE 74 DESCRIPTION Apr. 6 Sales Returns and Allowances Accounts Receivable, 3 4 Myers Company 113/ Issued credit memo no Sales Returns and Allowances Accounts Receivable, 8 9 Brooks and Bennett 113/ Issued credit memo no Sales Returns and Allowances Accounts Receivable, Diaz Hardware 113/ Issued credit memo no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 393

33 Problem 9-4A (continued) GENERAL LEDGER Accounts Receivable NO. 113 Apr. 1 Balance 1, J , J , J S39 4, , Sales NO. 411 Apr. 1 Balance 11, S39 4, , Sales Returns and Allowances NO. 412 Apr. 1 Balance J J J Brooks and Bennett S RECEIVABLE LEDGER Apr. 1 Balance S , J , Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

34 Problem 9-4A (continued) Diaz Hardware Apr. 10 S S , J , L. R. Foster Company Apr. 5 S Myers Company Apr. 1 Balance S J Ortiz Company Apr. 24 S Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 395

35 Problem 9-4A (concluded) Powell and Reyes Apr. 17 S Gomez Company Schedule of Accounts Receivable April 30, Brooks and Bennett Diaz Hardware L. R. Foster Company Myers Company Ortiz Company Powell and Reyes Total Accounts Receivable $1, , $5, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

36 Problem 9-5A PURCHASES JOURNAL PAGE 81 SUPPLIER'S INV. NO. INV. TERMS S PAYABLE FREIGHT IN PURCHASES Jan. 2 Snyder and Jordan 268J 1/2 net 60 1, , Simpson Company /2 2/10, n/30 2, , Tran, Inc. 452AD 1/6 1/10, n/ Ukele Company D7742 1/7 2/10, n/30 3, , Fernandez Products Company /13 net Snyder and Jordan 392J 1/22 net 60 2, , Fernandez Products Company /27 net Porter Company 664CC 1/27 2/10, n/ Totals 12, , (212) (514) (511) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 397

37 Problem 9-5A (continued) Accounts Payable GENERAL LEDGER NO. 212 Jan. 1 Balance P81 12, , Purchases NO. 511 Jan. 31 P81 11, , Freight In NO. 514 Jan. 31 P Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

38 Problem 9-5A (continued) S PAYABLE LEDGER Fernandez Products Company Jan. 14 P P , Porter Company Jan. 1 Balance P Simpson Company Jan. 1 Balance P81 2, , Snyder and Jordan Jan. 2 P81 1, , P81 2, , Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 399

39 Problem 9-5A (concluded) Tran, Inc. Jan. 1 Balance P Ukele Company Jan. 10 P81 3, , Patterson Appliance Schedule of Accounts Payable January 31, Fernandez Products Company Porter Company Simpson Company Snyder and Jordan Tran, Inc. Ukele Company Total Accounts Payable $ 1, , , , $12, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

40 Problem 9-6A SALES JOURNAL PAGE 24 INV. NO. CUSTOMER'S S RECEIVABLE DR. SALES CR Apr Shaw Company 1, Peterson and Black C. N. Hunt 1, Sampson and McDonald 2, Total 6, (113) (411) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 401

41 Problem 9-6A (continued) PURCHASES JOURNAL PAGE 18 SUPPLIER'S INV. NO. INV. TERMS S PAYABLE FREIGHT IN PURCHASES Apr. 4 Payne Company /2 1/10, n/ Vix Company L8552 4/11 2/10, n/30 2, , M. R. Palmer, Inc /23 2/10, n/30 1, , Totals 4, , (212) (514) (511) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

42 Problem 9-6A (continued) DESCRIPTION GENERAL JOURNAL PAGE Apr. 15 Accounts Payable, Knight and Co. 212/ Purchases Returns and Allowances Credit memo no. 79 for return 4 5 of merchandise Sales Returns and Allowances Accounts Receivable, Peterson 8 9 and Black 113/ Issued credit memo no Office Supplies Expense Accounts Payable, Thornton Stationery Company 212/ Invoice no. S336, invoice dated /29, terms n/ Sales Returns and Allowances Accounts Receivable, Sampson and McDonald 113/ Issued credit memo no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 403

43 Problem 9-6A (continued) GENERAL LEDGER Accounts Receivable NO. 113 Apr. 1 Balance 1, J , J , S24 6, , Accounts Payable NO. 212 Apr. 1 Balance J J P18 4, , Sales NO. 411 Apr. 1 Balance 11, S24 6, , Sales Returns and Allowances NO. 412 Apr. 1 Balance J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

44 Problem 9-6A (continued) Purchases NO. 511 Apr. 1 Balance 9, P18 4, , Purchases Returns and Allowances NO. 512 Apr. 1 Balance J Freight In NO. 514 Apr. 1 Balance P Office Supplies Expense NO. 613 Apr. 1 Balance J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 405

45 Problem 9-6A (continued) C. N. Hunt S RECEIVABLE LEDGER Apr. 17 S24 1, , Peterson and Black Apr. 1 Balance S , J , Sampson and McDonald Apr. 1 Balance S24 2, , J , Shaw Company Apr. 2 S24 1, , Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

46 Problem 9-6A (continued) Knight and Company S PAYABLE LEDGER Apr. 1 Balance J M. R. Palmer, Inc. Apr. 1 Balance P18 1, , Payne Company Apr. 4 P Thornton Stationery Company Apr. 29 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 407

47 Problem 9-6A (concluded) Vix Company Apr. 12 P18 2, , Reynolds Company Schedule of Accounts Receivable April 30, C. N. Hunt Peterson and Black Sampson and McDonald Shaw Company Total Accounts Receivable $1,015 1,200 3,422 1,746 $7,383 Reynolds Company Schedule of Accounts Payable April 30, Knight and Company M. R. Palmer, Inc. Payne Company Thornton Stationery Company Vix Company Total Accounts Payable $ 142 1, ,531 $5, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

48 Problem 9-1B GENERAL JOURNAL PAGE 57 DESCRIPTION Mar. 4 Accounts Receivable, R. Duarte 113/ Sales Sales Tax Payable Sold merchandise to R. Duarte, 5 6 sales slip no Accounts Receivable, C. Meadows 113/ Sales Sales Tax Payable Sold merchandise to C Meadows, sales slip no Accounts Receivable, Anthony Realty 113/ Sales Sales Tax Payable Sold merchandise to Anthony Realty, sales slip no Accounts Receivable, Travis Dress Shop 113/ Sales Sales Tax Payable Sold merchandise to Travis Dress Shop, sales slip no Sales Returns and Allowances Sales Tax Payable Accounts Receivable, Travis Dress Shop 113/ Issued credit memo no Accounts Receivable, Porter Computers 113/ Sales Sales Tax Payable Sold merchandise to Porter Computers, sales slip no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 409

49 Problem 9-1B (continued) GENERAL JOURNAL PAGE 58 DESCRIPTION Mar. 22 Sales Returns and Allowances Sales Tax Payable Accounts Receivable, Porter 4 5 Computers 113/ Issued credit memo no Accounts Receivable, B. Crosby 113/ Sales Sales Tax Payable Sold merchandise to B. Crosby, sales slip no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

50 Problem 9-1B (continued) GENERAL LEDGER Accounts Receivable NO. 113 Mar. 1 Balance J J J J J J J J Sales Tax Payable NO. 214 Mar. 1 Balance J J J J J J J J Sales NO. 411 Mar. 4 J J J J J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 411

51 Problem 9-1B (continued) Sales Returns and Allowances NO. 412 Mar. 20 J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

52 Problem 9-1B (continued) Anthony Realty S RECEIVABLE LEDGER Mar. 1 Balance J B. Crosby Mar. 27 J R. Duarte Mar. 4 J C. Meadows Mar. 1 Balance J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 413

53 Problem 9-1B (concluded) Porter Computers Mar. 1 Balance J J Travis Dress Shop Mar. 17 J J Abbott Florists Schedule of Accounts Receivable March 31, Anthony Realty B. Crosby R. Duarte C. Meadows Porter Computers Travis Dress Shop Total Accounts Receivable $ $ Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

54 Problem 9-2B GENERAL JOURNAL PAGE 95 DESCRIPTION Oct. 3 Purchases Freight In Accounts Payable, Barrera Company 212/ 1, Purchased merchandise from 5 6 Barrera Company, invoice no , invoice dated 10/2, terms 7 8 n/ Purchases Accounts Payable, Hickman Company 212/ Purchased merchandise from Hickman Company, invoice no JYX, invoice dated 10/2, terms /10, n/ Purchases Accounts Payable, Baldwin, Inc. 212/ Purchased merchandise from Baldwin, Inc., invoice no. 4183, invoice dated 10/6, terms 1/10, n/ Accounts Payable, Baldwin, Inc. 212/ Purchases Returns and Allowances Credit memo no. 123 for return of merchandise Purchases 511 2, Freight In Accounts Payable, Douglas, Inc. 212/ 2, Purchased merchandise from Douglas, Inc., invoice no. X431, invoice dated 10/12, terms 2/10, n/ Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 415

55 Problem 9-2B (continued) DESCRIPTION GENERAL JOURNAL PAGE Oct. 15 Purchases Accounts Payable, Krause, Inc. 212/ Purchased merchandise from 4 5 Krause, Inc., invoice no. A499, 5 6 invoice dated 10/11, terms net Purchases 511 2, Accounts Payable, Villa 9 10 Manufacturing 212/ 2, Purchased merchandise from Villa Manufacturing, invoice no , invoice dated 10/21, terms net Accounts Payable, Villa Manufacturing 212/ Purchases Returns and Allowances Credit memo no. 452 for return of merchandise Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

56 Problem 9-2B (continued) GENERAL LEDGER Accounts Payable NO. 212 Oct. 1 Balance 2, J95 1, , J , J , J , J95 2, , J , J96 2, , J , Purchases NO. 511 Oct. 1 Balance 2, J , J , J , J95 2, , J , J96 2, , Purchases Returns and Allowances NO. 512 Oct. 1 Balance J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 417

57 Problem 9-2B (continued) Freight In NO. 514 Oct. 1 Balance J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

58 Problem 9-2B (continued) Baldwin, Inc. S PAYABLE LEDGER Oct. 1 Balance J J Barrera Company Oct. 1 Balance J95 1, , Douglas, Inc. Oct. 1 Balance J95 2, , Hickman Company Oct. 4 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 419

59 Problem 9-2B (concluded) Krause, Inc. Oct. 1 Balance J Villa Manufacturing Oct. 1 Balance J96 2, , J , Lowery's Pet Depot Schedule of Accounts Payable October 31, Baldwin, Inc. Barrera Company Douglas, Inc. Hickman Company Krause, Inc. Villa Manufacturing Total Accounts Payable $ , , , $8, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

60 Problem 9-3B GENERAL JOURNAL PAGE 17 DESCRIPTION Jan. 2 Purchases Freight In Accounts Payable, Mejia, Inc. 212/ Purchased merchandise from 5 6 Mejia, Inc., invoice no. 4521, 6 7 invoice dated 1/1, terms 2/10, 7 8 n/ Purchases 511 1, Accounts Payable, Braun, Inc. 212/ 1, Purchased merchandise from Braun, Inc., invoice no. 37A, invoice dated 1/3, terms 2/10, n/ Accounts Receivable, J. Herbert 113/ Sales Sales Tax Payable Sold merchandise to J. Herbert, sales slip no Accounts Payable, Braun, Inc. 212/ Purchases Returns and Allowances Credit memo no. 455 for return of merchandise Purchases Accounts Payable, Vargas, Inc. 212/ Purchased merchandise from Vargas, Inc., invoice no. 910, invoice dated 1/14, terms net Accounts Receivable, T. Cantrell 113/ Sales Sales Tax Payable Sold merchandise to T. Cantrell, sales slip no Sales Returns and Allowances Sales Tax Payable Accounts Receivable, T. Cantrell 113/ Issued credit memo no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 421

61 Problem 9-3B (continued) GENERAL LEDGER Accounts Receivable NO. 113 Jan. 1 Balance J J J Accounts Payable NO. 212 Jan. 1 Balance J , J17 1, , J , J , Sales Tax Payable NO. 214 Jan. 1 Balance J J J Sales 411 NO. Jan. 8 J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

62 Problem 9-3B (continued) Sales Returns and Allowances NO. 412 Jan. 26 J Purchases NO. 511 Jan. 2 J J17 1, , J , Purchases Returns and Allowances NO. 512 Jan. 11 J Freight In NO. 514 Jan. 2 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 423

63 Problem 9-3B (continued) T. Cantrell S RECEIVABLE LEDGER Jan. 1 Balance J J J. Herbert Jan. 1 Balance J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

64 Problem 9-3B (continued) Braun, Inc. S PAYABLE LEDGER Jan. 1 Balance J17 1, , J , Mejia, Inc. Jan. 1 Balance J Vargas, Inc. Jan. 1 Balance J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 425

65 Problem 9-3B (concluded) May's Beauty Store Schedule of Accounts Receivable January 31, T. Cantrell J. Herbert Total Accounts Receivable $ $ May's Beauty Store Schedule of Accounts Payable January 31, Braun, Inc. Mejia, Inc. Vargas, Inc. Total Accounts Payable $1, $2, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

66 Problem 9-4B SALES JOURNAL PAGE 39 INV. NO. CUSTOMER'S S RECEIVABLE DR. SALES CR Apr Maxwell Company B. A. Fitzpatrick Company Durham Hardware Briggs and Campos Pena and Carr O'Neill Company Durham Hardware Total 4, (113) (411) GENERAL JOURNAL PAGE 74 DESCRIPTION Apr. 13 Sales Returns and Allowances Accounts Receivable, 3 4 B. A. Fitzpatrick Company 113/ Issued credit memo no Sales Returns and Allowances Accounts Receivable, 8 9 Briggs and Campos 113/ Issued credit memo no Sales Returns and Allowances Accounts Receivable, Durham Hardware 113/ Issued credit memo no Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 427

67 Problem 9-4B (continued) GENERAL LEDGER Accounts Receivable NO. 113 Apr. 1 Balance 1, J , J J S39 4, , Sales NO. 411 Apr. 1 Balance 11, S39 4, , Sales Returns and Allowances NO. 412 Apr. 1 Balance J J J Briggs and Campos S RECEIVABLE LEDGER Apr. 1 Balance S , J , Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

68 f Problem 9-4B (continued) Durham Hardware CHAPTER 9 Apr. 8 S J S B. A. Fitzpatrick Company Apr. 7 S J Maxwell Company Apr. 1 Balance S O'Neill Company Apr. 26 S Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 429

69 Problem 9-4B (concluded) Pena and Carr Apr. 21 S R. J. Hinton Company Schedule of Accounts Receivable April 30, Briggs and Campos Durham Hardware B. A. Fitzpatrick Company Maxwell Company O'Neill Company Pena and Carr Total Accounts Receivable $1, $4, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

70 Problem 9-5B PURCHASES JOURNAL PAGE 81 SUPPLIER'S INV. NO. INV. TERMS S PAYABLE FREIGHT IN PURCHASES Jan. 4 Nielsen Company /3 n/60 4, , Barton Tire Company /5 2/10, n/ Gross Products Company /6 n/ Bray, Inc. 291GE 1/9 1/10, n/ Gross Products Company /17 n/ Nielsen Company /23 n/60 1, , Davila Manufacturing Company 762AC 1/26 2/10, n/ Lamb Safety Net /26 2/10, n/ Totals 8, , (212) (514) (511) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 431

71 Problem 9-5B (continued) Accounts Payable GENERAL LEDGER NO. 212 Jan. 1 Balance P81 8, , Purchases NO. 511 Jan. 31 P81 8, , Freight In NO. 514 Jan. 31 P Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

72 Problem 9-5B (continued) Barton Tire Company S PAYABLE LEDGER Jan. 1 Balance P Bray, Inc. Jan. 11 P Davila Manufacturing Company Jan. 1 Balance P Gross Products Company Jan. 8 P P Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 433

73 Problem 9-5B (concluded) Lamb Safety Net Jan. 1 Balance P Nielsen Company Jan. 4 P81 4, , P81 1, , West Bicycle Shop Schedule of Accounts Payable January 31, Barton Tire Company Bray, Inc. Davila Manufacturing Company Gross Products Company Lamb Safety Net Nielsen Company Total Accounts Payable $ , $9, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

74 Problem 9-6B SALES JOURNAL PAGE 24 INV. NO. CUSTOMER'S S RECEIVABLE DR. SALES CR Apr Hubbard Hardware Booth Stores 1, J. A. Acevedo Grimes Specialty Company 3, Total 6, (113) (411) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 435

75 Problem 9-6B (continued) PURCHASES JOURNAL PAGE 18 SUPPLIER'S TERMS INV. NO. INV. S PAYABLE FREIGHT IN PURCHASES Apr. 4 Roth Manufacturing Company C1142 4/2 1/10, n/ Baird Products Company /11 2/10, n/30 1, , Atkins Manufacturing Company P1981 4/22 2/10, n/30 1, , Totals 3, , (212) (514) (511) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

76 Problem 9-6B (continued) DESCRIPTION GENERAL JOURNAL PAGE Apr. 19 Sales Returns and Allowances Accounts Receivable, Booth Stores 113/ Issued credit memo no Office Supplies Expense Accounts Payable, Carson and Dyer 212/ Invoice no. E621A, invoice dated 8 9 4/25, terms n/ Sales Returns and Allowances Accounts Receivable, J. A. Acevedo 113/ Issued credit memo no Accounts Payable, Barajas, Inc. 212/ Purchases Returns and Allowances Credit memo no. 79 for return of merchandise Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 437

77 Problem 9-6B (continued) GENERAL LEDGER Accounts Receivable NO. 113 Apr. 1 Balance 1, J , J , S24 6, , Accounts Payable NO. 212 Apr. 1 Balance J J P18 3, , Sales NO. 411 Apr. 1 Balance 11, S24 6, , Sales Returns and Allowances NO. 412 Apr. 1 Balance J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

78 Problem 9-6B (continued) Purchases NO. 511 Apr. 1 Balance 9, P18 3, , Purchases Returns and Allowances NO. 512 Apr. 1 Balance J Freight In NO. 514 Apr. 1 Balance P Office Supplies Expense NO. 613 Apr. 1 Balance J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 439

79 Problem 9-6B (continued) J. A. Acevedo S RECEIVABLE LEDGER Apr. 16 S J Booth Stores Apr. 1 Balance S24 1, , J , Grimes Specialty Company Apr. 1 Balance S24 3, , Hubbard Hardware Apr. 1 Balance S , Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

80 Problem 9-6B (continued) S PAYABLE LEDGER Atkins Manufacturing Company Apr. 24 P18 1, , Baird Products Company Apr. 1 Balance P18 1, , Barajas, Inc. Apr. 1 Balance J Carson and Dyer Apr. 27 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 441

81 Problem 9-6B (concluded) Roth Manufacturing Company Apr. 4 P Kaufman Metal Products Schedule of Accounts Receivable April 30, J. A. Acevedo Booth Stores Grimes Specialty Company Hubbard Hardware Total Accounts Receivable $ , , , $7, Kaufman Metal Products Schedule of Accounts Payable April 30, Atkins Manufacturing Company Baird Products Company Barajas, Inc. Carson and Dyer Roth Manufacturing Company Total Accounts Payable $1, , $4, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

82 SOLUTIONS TO ACTIVITIES CONSIDER AND COMMUNICATE Suggested Response Speak to the buyers who order goods. Are they ordering inferior goods? Are the vendors sending inferior goods? Speak to the Receiving Department to see if goods are being mishandled. Also, ask if the goods are arriving in poor condition. The problem may be with the freight carriers. Are the goods appropriately packed and handled? CRITICAL THINKING Suggested Response 1. Most likely, the bookkeeper recorded the $1,800 in sales tax as a credit to sales. Sales Tax Payable should have a credit balance of $1,730 ($1,800 collected $70 on customer returns). Correction: Debit Sales $1,800, credit Sales Tax Payable $1,800 (an omitted account). Most likely, the bookkeeper recorded the $970 in customer returns as a debit to Sales and a credit to Accounts Receivable. Correction: Debit Sales Returns and Allowances $900 (an omitted account), credit Sales $970, and debit Sales Tax Payable $70. Sales Tax Payable Sales Sales Returns and Allowances ,800 1, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 443

83 CRITICAL THINKING (concluded) Pierce Retail Outlet Trial Balance March 31, Cash 8,940 Accounts Receivable 480 Store Equipment 9,460 Accounts Payable 958 Sales Tax Payable 1,730 D. Pierce, Capital 11,959 D. Pierce, Drawing 4,480 Sales 17,170 Sales Returns and Allowances 900 Rent Expense 2,400 Wages Expense 4,864 Supplies Expense 175 Miscellaneous Expense ,817 31, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

84 Problem 9A-1 DESCRIPTION GENERAL JOURNAL PAGE June 1 Accounts Receivable, Hendrix Office 2 3 Store Sales Sold merchandise to Hendrix 5 6 Office Store, invoice no Cost of Goods Sold Merchandise Inventory Cost of merchandise sold to Hendrix Office Store, invoice no Merchandise Inventory Accounts Payable, Krueger, Inc Purchased merchandise from Krueger, Inc., invoice no. 845A, invoice dated 6/1, terms 1/10, n/ Accounts Receivable, Ballard Stores 2, Sales 2, Sold merchandise to Ballard Stores, invoice no Cost of Goods Sold 2, Merchandise Inventory 2, Cost of merchandise sold to Ballard Stores, invoice no Merchandise Inventory 2, Accounts Payable, Kennedy, Inc. 2, Purchased merchandise from Kennedy, Inc., invoice no. 4833, invoice dated 6/11, terms 2/10, n/ Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 445

85 Problem 9A-1 (concluded) GENERAL JOURNAL PAGE 26 DESCRIPTION June 18 Accounts Receivable, Lawson Office 2 3 Store Sales Sold merchandise to Lawson 5 6 Office Store, invoice no Cost of Goods Sold Merchandise Inventory Cost of merchandise sold to Lawson Office Store, invoice no Sales Returns and Allowances Accounts Receivable, Lawson Office Store Issued credit memo no Merchandise Inventory Cost of Goods Sold Cost of merchandise returned, credit memo no Merchandise Inventory 1, Accounts Payable, Villarreal, Inc. 1, Purchased merchandise from Villarreal, Inc., invoice no. 4R32, invoice dated 6/18, terms net Accounts Payable, Villarreal, Inc Merchandise Inventory Credit memo no. 44 for return of merchandise Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

86 Problem 9A-2 GENERAL JOURNAL PAGE 84 DESCRIPTION Nov. 3 Accounts Receivable, Spence Tennis 2 3 Shop 2, Sales 2, Sold merchandise to Spence 5 6 Tennis Shop, invoice no Cost of Goods Sold 1, Merchandise Inventory 1, Cost of merchandise sold to Spence Tennis Shop, invoice no Sales Returns and Allowances Accounts Receivable, Spence Tennis Shop Issued credit memo no Merchandise Inventory Cost of Goods Sold Cost of merchandise returned, credit memo no Merchandise Inventory 3, Accounts Payable, Maldonado Manufacturing, Inc. 3, Purchased merchandise from Maldonado Manufacturing, Inc., invoice no. 1548, invoice dated /4, terms net Merchandise Inventory Accounts Payable, Lozano, Inc Purchased merchandise from Lozano, Inc., invoice no. 8755, invoice dated 11/5, terms 1/15, n/ Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 447

87 Problem 9A-2 (concluded) GENERAL JOURNAL PAGE 85 DESCRIPTION Nov. 12 Accounts Payable, Lozano, Inc Merchandise Inventory Credit memo no. 542 for return 4 5 of merchandise Accounts Receivable, Jack's Golfing 7 8 Shop Sales Sold merchandise to Jack's Golfing Shop, invoice no Cost of Goods Sold Merchandise Inventory Cost of merchandise sold to Jack's Golfing Shop, invoice no Accounts Receivable, Yates Sporting Goods 2, Sales 2, Sold merchandise to Yates Sporting Goods, invoice no Cost of Goods Sold 1, Merchandise Inventory 1, Cost of merchandise sold to Yates Sporting Goods, invoice no Merchandise Inventory Accounts Payable, Fields, Inc Purchased merchandise from Fields, Inc., invoice no , invoice dated 11/25, terms /10, n/ Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

88 ALL ABOUT YOU SPA: GENERAL JOURNAL PAGE 6 DESCRIPTION 1 Reversing Entry 1 2 July 1 Wages Payable Wages Expense July Transactions 6 1 Cash , A. Valli, Capital , Owner invested cash in business Spa Supplies Expense Accounts Payable/Golden Spa Supplies 211/ Bought spa supplies on account, Inv Purchases 511 5, Freight In Accounts Payable/Spa Goods 211/ 5, Bought merch. on account, Inv Purchases 511 3, Freight In Accounts Payable/Logo Products 211/ 3, Bought merch. on acct., Inv Purchases 511 2, Freight In Accounts Payable/Spa Magic 211/ 2, Bought merch. on acct., Inv Accts. Receivable/Los Obrigados Lodge 113/ Merchandise Sales Sales Tax Payable Sold merch. on account, Inv Spa Equipment 124 8, Accounts Payable/Spa Equipment, Inc. 211/ 6, Cash 111 2, Bought spa equip. on account with down payment, Ck. 1027, Inv Rent Expense 612 1, Cash 111 1, Paid July rent, Ck *Alternatively, if the purchases journal is used, this entry will appear as shown on page 455. **Alternatively, if the sales journal is used, this entry will appear as shown on page 454. * * * ** 2011 Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 449

89 ALL ABOUT YOU SPA (continued) GENERAL JOURNAL PAGE 7 DESCRIPTION July 3 Accounts Payable/Spa Equipment, Inc. 211/ Cash Paid Inv in full, Ck Accounts Receivable/Chaco's 113/ Merchandise Sales Sales Tax Payable Sold merch. on account, Inv Accounts Payable/Golden Spa Supplies 211/ Cash Paid Inv. 804 in full, Ck Accounts Payable/Office Staples 211/ Cash Paid Inv. 522 in full, Ck Miscellaneous Expense Cash Paid for flowers and balloons for lobby, Ck Accounts Payable/Adco, Inc. 211/ Cash Paid Inv. no. 512 in full, Ck Wages Expense 611 1, Cash 111 1, Paid week's wages, Ck Office Equipment Accounts Payable/Superior Equipment 211/ Bought office equip. on account, Inv Miscellaneous Expense Accounts Payable/ Office Staples 211/ Bought books for waiting room on account, Inv Office Supplies Expense Accounts Payable/ Office Staples 211/ Bought office supplies on account, Inv * Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

90 ALL ABOUT YOU SPA (continued) GENERAL JOURNAL PAGE 8 DESCRIPTION July 5 Purchases 511 1, Freight In Accounts Payable/Giftco 211/ 1, * 5 Bought merch. on account, Inv Accts. Receivable/Pleasant Spa 113/ 1, Merchandise Sales 412 1, Sales Tax Payable ** 10 Sold merch. on account, Inv Cash 111 4, Merchandise Sales 412 1, Income from Services 411 3, Sales Tax Payable First week's cash revenue Cash Accounts Receivable/Jill Anson 113/ Rec'd payment on account, Inv Accounts Receivable/Holmes Condos 113/ Merchandise Sales Sales Tax Payable ** 25 Sold merch. on account, Inv Accounts Receivable/Mini Spa 113/ Merchandise Sales Sales Tax Payable ** 30 Sold merch. on account, Inv Wages Expense 611 1, Cash 111 1, Paid week's wages, Ck Accounts Receivable/About Face Spa 113/ Merchandise Sales Sales Tax Payable Sold merch. on account, Inv Cash Accounts Receivable/Jack Morgan 113/ Rec'd payment on account, Inv *Alternatively, if the purchases journal is used, this entry will appear as shown on page 455. **Alternatively, if the sales journal is used, this entry will appear as shown on page Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 451

91 ALL ABOUT YOU SPA (continued) GENERAL JOURNAL PAGE 9 DESCRIPTION July 14 Cash 111 4, Merchandise Sales 412 1, Income from Services 411 2, Sales Tax Payable Second week's cash revenue Accounts Payable/Superior Equipment 211/ 1, Cash 111 1, Paid Inv in full, Ck Wages Expense 611 1, Cash 111 1, Paid week's wages, Ck Cash Accounts Receivable/Tory Ligman 113/ Rec'd payment on account, Inv Cash 111 5, Merchandise Sales 412 1, Income from Services 411 2, Sales Tax Payable Third week's cash revenue Spa Equipment Cash Bought nail cart for cash, Ck Wages Expense 611 1, Cash 111 1, Paid week's wages, Ck Laundry Expense Cash Paid month's laundry bill, Ck Cash Accounts Receivable/Judy Wilcox 113/ Rec'd payment on account, Inv Cash 111 6, Merchandise Sales 412 1, Income from Services 411 4, Sales Tax Payable End of month's cash revenue Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

92 ALL ABOUT YOU SPA (continued) GENERAL JOURNAL PAGE 10 DESCRIPTION July 31 A. Valli, Drawing 312 2, Cash 111 2, Owner withdrew cash for personal 4 5 use, Ck Utilities Expense Cash Paid monthly telephone bill, 9 10 Ck Utilities Expense Cash Paid monthly power and water bill, Ck Spa Equipment 124 1, A. Valli, Capital 311 1, Investment by owner of personal spa equipment Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 453

93 ALL ABOUT YOU SPA (continued) Optional: If the sales journal is used, the sales on account entries will appear as follows: SALES JOURNAL 1 INV. NO. CUSTOMER'S S RECEIVABLE SALES TAX PAYABLE MERCHANDISE SALES July 2 14 Los Obrigados Lodge Chaco's Pleasant Spa 1, , Holmes Condos Mini Spa About Face Spa Totals 3, , (113) (215) (412) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

94 ALL ABOUT YOU SPA (continued) Optional: If the purchases journal is used, the purchases on account entries will appear as follows: PURCHASES JOURNAL PAGE 1 SUPPLIER'S INV. NO. INV. TERMS S PAYABLE FREIGHT IN PURCHASES July 1 Spa Goods 312 7/1 2/10, n/60 5, , Logo Products /1 2/10, n/60 3, , Spa Magic /2 2/10, n/30 2, , Giftco 316 7/5 2/10, n/60 1, , Totals 13, , (211) (515) (511) Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 455

95 ALL ABOUT YOU SPA (continued) GENERAL LEDGER Cash NO. 111 July 1 Balance 15, J6 25, , J6 2, , J6 1, , J , J , J , J , J , J7 1, , J8 4, , J , J8 1, , J , J9 4, , J9 1, , J9 1, , J , J9 5, , J , J9 1, , J , J , J9 6, , J10 2, , J , J , Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

96 ALL ABOUT YOU SPA (continued) Accounts Receivable NO. 113 July 1 Balance 1, J , J , J8 1, , J , J , J , J , J , J , J , Alternatively, if the sales journal is used, all debit entries above would be posted as a single total from the Accounts Receivable Debit column of the sales journal, as follows: 31 S1 3, , Prepaid Insurance 117 NO. July 1 Balance Spa Equipment NO. 124 July 1 Balance 7, J6 8, , J , J10 1, , Accumulated Depreciation, Spa Equipment 125 NO. July 1 Balance Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 457

97 ALL ABOUT YOU SPA (continued) Office Equipment 128 NO. July 1 Balance 1, J , Accumulated Depreciation, Office Equipment NO. 129 July 1 Balance Accounts Payable NO. 211 July 1 Balance 2, J , J6 5, * 8, J6 3, * 11, J6 2, * 14, J6 6, , J , J , J , J , J , J , J , J8 1, * 21, J9 1, , *Alternatively, if the purchases journal is used, all credit entries with asterisks above would be posted as a single total from the Accounts Payable Credit column of the purchases journal, as follows: 31 P1 13, , Wages Payable NO. 212 July 1 Balance Reversing J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

98 ALL ABOUT YOU SPA (continued) Sales Tax Payable NO. 215 July 2 J * J * J * J J * J * J * J J , J , *Alternatively, if the sales journal is used, all credit entries with asterisks above would be posted as a single total from the Sales Tax Payable Credit column of the sales journal, as follows: 31 S , A. Valli, Capital NO. 311 July 1 Balance 23, J6 25, , J10 1, , A. Valli, Drawing NO. 312 July 31 J10 2, , Income Summary NO Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 459

99 ALL ABOUT YOU SPA (continued) Income from Services NO. 411 July 7 J8 3, , J9 2, , J9 2, , J9 4, , Merchandise Sales NO. 412 July 2 J * J * J8 1, * 2, J8 1, , J * 4, J * 4, J * 5, J9 1, , J9 1, , J9 1, , Alternatively, if the sales journal is used, all credit entries with asterisks above would be posted as a single total from the Sales Credit column of the sales journal, as follows: 31 S1 3, , Purchases NO. 511 July 1 J6 5, , J6 3, , J6 2, , J8 1, , Alternatively, if the purchases journal is used, all debit entries above would be posted as a single total from the Purchases Debit column of the purchases journal, as follows: 31 P1 12, , Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

100 ALL ABOUT YOU SPA (continued) Freight In NO. 515 July 1 J J J J Alternatively, if the purchases journal is used, all debit entries above would be posted as a single total from the Freight In Debit column of the purchases journal, as follows: 31 P Wages Expense NO. 611 July 1 Reversing J J7 1, , J8 1, , J9 1, , J9 1, , Rent Expense 612 NO. July 3 J6 1, , Office Supplies Expense NO. 613 July 5 J Spa Supplies Expense NO. 614 July 1 J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 461

101 ALL ABOUT YOU SPA (continued) Laundry Expense NO. 615 July 28 J Advertising Expense NO. 616 Utilities Expense 617 NO. July 31 J J Insurance Expense NO. 618 Depreciation Expense, Spa Equipment NO. 619 Depreciation Expense, Office Equipment NO Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

102 ALL ABOUT YOU SPA (continued) Miscellaneous Expense NO. 630 July 5 J J Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 463

103 ALL ABOUT YOU SPA (continued) S RECEIVABLE LEDGER About Face Spa July 12 J8* Jill Anson July 1 Balance J Chaco's July 4 J7* Holmes Condos July 10 J8* *Alternatively, if the sales journal is used, these posting references will be S Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

104 ALL ABOUT YOU SPA (continued) Tory Ligman July 1 Balance J Los Obrigados Lodge July 2 J6* Mini Spa July 10 J8* Jack Morgan July 1 Balance J *Alternatively, if the sales journal is used, these posting references will be S Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 465

105 ALL ABOUT YOU SPA (continued) Pleasant Spa July 5 J8* 1, , Judy Wilcox July 1 Balance J *Alternatively, if the sales journal is used, this posting reference will be S Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

106 ALL ABOUT YOU SPA (continued) S PAYABLE LEDGER Adco, Inc. July 1 Balance J Giftco July 5 J8* 1, , Golden Spa Supplies July 1 Balance J J Logo Products July 1 J6* 3, , *Alternatively, if the purchases journal is used, these posting references will be P Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 467

107 ALL ABOUT YOU SPA (continued) Office Staples July 1 Balance J J J Spa Equipment, Inc. July 1 Balance J6 6, , J , Spa Goods July 1 J6* 5, , Spa Magic July 2 J6* 2, , *Alternatively, if the purchases journal is used, these posting references will be P Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

108 ALL ABOUT YOU SPA (continued) Superior Equipment July 1 Balance 1, J , J9 1, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 469

109 ALL ABOUT YOU SPA (continued) All About You Spa Trial Balance July 31, Cash 44, Accounts Receivable 4, Prepaid Insurance Spa Equipment 17, Accumulated Depreciation, Spa Equipment Office Equipment 1, Accumulated Depreciation, Office Equipment Accounts Payable 20, Sales Tax Payable 1, A. Valli, Capital 49, A. Valli, Drawing 2, Income from Services 12, Merchandise Sales 10, Purchases 12, Freight In Wages Expense 7, Rent Expense 1, Office Supplies Expense Spa Supplies Expense Laundry Expense Utilities Expense Miscellaneous Expense , , Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part.

110 ALL ABOUT YOU SPA (concluded) All About You Spa Schedule of Accounts Receivable July 31, About Face Spa $ Jill Anson Chaco's Holmes Condos Tory Ligman Los Obrigados Lodge Mini Spa Jack Morgan Pleasant Spa 1, Total Accounts Receivable $4, All About You Spa Schedule of Accounts Payable July 31, Giftco $ 1, Golden Spa Supplies Logo Products 3, Office Staples Spa Equipment, Inc. 6, Spa Goods 5, Spa Magic 2, Superior Equipment Total Accounts Payable $20, Cengage Learning. All Rights Reserved. May not be scanned, copied, duplicated, or posted to a publicly accessible website, in whole or in part. 471