Financial Accounting
14th Edition
ISBN: 9781305088436
Author: Carl Warren, Jim Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Chapter 5, Problem 17E
To determine
Prepare purchase journal and cash payment journal to record the transactions.
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Fiona Sporty uses a purchases journal, a cash payments journal, a sales journal, a cash receipts journal and a general journal. Indicate in which journals the following transactions are most likely to be recorded.
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End of period closing entries
Week 7
Below is information about Lisa Ltd’s cash position for the month of June 2019.
The general ledger Cash at Bank account had a balance of $21,200 on 31 May.
The cash receipts journal showed total cash receipts of $292,704 for June.
The cash payments journal showed total cash payments of $265,074 for June.
The June bank statement reported a bank balance of $41,184 on 30 June.
Outstanding cheques at the end of June were: no. 3456, $1,448; no. 3457, $84; no. 3460, $70 and no. 3462, $410.
Cash receipts of $10,090 for 30 June were not included in the June bank statement.
Included on the bank…
Using the sales and cash receipts journals
The sales and cash receipts journals of Caverly Office Products include the following entries:
Identify the missing information in the cash receipts journal for those transactions listed. All credit sales are terms n/30. Assume all the accounts are paid in full. Also, total the columns in the cash receipts journal and show that total debits equal total credits.
Nguyen Company uses a single-column purchases journal to record transactions with its suppliers. The company uses a multi-column cash payments journal.For each of the following transactions, indicate (a) the journal, and (b) the columns in the journal that should be used in recording each transaction. (Enter answers in alphabetical order.)
(b)Columns in the Journal
Transactions
(a)Journal
Dr.
Cr.
1.
Purchased merchandise on account.
select a journal Cash PaymentsCash ReceiptsGeneralPurchasesSales
select a debit column InventoryAccounts PayableSales ExpenseAccounts ReceivableOther AccountsSales RevenueCost of Goods SoldCash
select a credit column Accounts ReceivableSales RevenueAccounts PayableCost of Goods SoldCashInventorySales ExpenseOther Accounts
2.…
Chapter 5 Solutions
Financial Accounting
Ch. 5 - Why would a company maintain separate accounts...Ch. 5 - What are the major advantages of the use of...Ch. 5 - In recording 400 fees earned on account during a...Ch. 5 - How many postings to Fees Earned for the month...Ch. 5 - During the current month, the following errors...Ch. 5 - Assuming the use of a two-column general journal,...Ch. 5 - What is an electronic form, and how is it used in...Ch. 5 - Prob. 8DQCh. 5 - What happens to the special journal in a...Ch. 5 - Prob. 10DQ
Ch. 5 - The following revenue transactions occurred during...Ch. 5 - Prob. 1PEBCh. 5 - The debits and credits from two transactions are...Ch. 5 - The debits and credits from two transactions are...Ch. 5 - The following purchase transactions occurred...Ch. 5 - Prob. 3PEBCh. 5 - The debits and credits from two transactions are...Ch. 5 - Prob. 4PEBCh. 5 - McHale Company does business in two customer...Ch. 5 - Prob. 5PEBCh. 5 - Using the following revenue journal for Zeta...Ch. 5 - Based on the data presented in Exercise 5-1,...Ch. 5 - Assuming the use of a two-column (all-purpose)...Ch. 5 - Assuming the use of a two-column (all-purpose)...Ch. 5 - Prob. 5ECh. 5 - Global Services Company had the following...Ch. 5 - The revenue journal for Sapling Consulting Inc....Ch. 5 - The revenue and cash receipts journals for Mirage...Ch. 5 - Transactions related to revenue and cash receipts...Ch. 5 - Lasting Summer Inc. has 2,510 in the October 1...Ch. 5 - Prob. 11ECh. 5 - Using the following cash payments journal,...Ch. 5 - Prob. 13ECh. 5 - Prob. 14ECh. 5 - The purchases journal for Newmark Exterior...Ch. 5 - Prob. 16ECh. 5 - Prob. 17ECh. 5 - Prob. 18ECh. 5 - After Bunker Hill Assay Services Inc. had...Ch. 5 - Prob. 20ECh. 5 - Prob. 21ECh. 5 - Most computerized accounting systems use...Ch. 5 - Prob. 23ECh. 5 - For each of the following companies, determine...Ch. 5 - Starbucks Corporation reported the following...Ch. 5 - Prob. 26ECh. 5 - Prob. 27ECh. 5 - Sage Learning Centers was established on July 20,...Ch. 5 - Transactions related to revenue and cash receipts...Ch. 5 - Sterling Forest Landscaping designs and installs...Ch. 5 - AquaFresh Water Testing Service was established on...Ch. 5 - The transactions completed by Revere Courier...Ch. 5 - Guardian Security Services was established on...Ch. 5 - Transactions related to revenue and cash receipts...Ch. 5 - Prob. 3PBCh. 5 - Prob. 4PBCh. 5 - The transactions completed by AM Express Company...Ch. 5 - Ethics in Action Netbooks Inc. provides accounting...Ch. 5 - The following conversation took place between...Ch. 5 - A subsidiary ledger is used for accounts...Ch. 5 - For the past few years, your client, Omni Care,...Ch. 5 - Prob. 5CP
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- Transactions related to purchases and cash payments completed by Wisk Away Cleaning Services Inc. during the month of May 20Y5 are as follows: Prepare a purchases journal and a cash payments journal to record these transactions. The forms of the journals are similar to those illustrated in the text. Place a check mark () in the Post. Ref. column to indicate when the accounts payable subsidiary ledger should be posted. Wisk Away Cleaning Services Inc. uses the following accounts:arrow_forwardTransactions related to revenue and cash receipts completed by Sycamore Inc. during the month of December 2016 are as follows: Prepare a single-column revenue journal and a cash receipts journal to record these transactions. Use the following column headings for the cash receipts journal: Fees Earned Cr., Accounts Receivable Cr., and Cash Dr. Place a check mark () in the Post. Ref. column to indicate when the accounts receivable subsidiary ledger should be posted.arrow_forwardTransactions related to revenue and cash receipts completed by Sterling Engineering Services during the period June 230, 2016, are as follows: Instructions 1. Insert the following balances in the general ledger as of June 1: 2. Insert the following balances in the accounts receivable subsidiary ledger as of June 1: 3. Prepare a single-column revenue journal (p. 40) and a cash receipts journal (p. 36). Use the following column headings for the cash receipts journal: Fees Earned Cr., Accounts Receivable Cr., and Cash Dr. The Fees Earned column is used to record cash fees. Insert a check mark () in the Post. Ref. column when recording cash fees. 4. Using the two special journals and the two-column general journal (p. 1), journalize the transactions for June. Post to the accounts receivable subsidiary ledger, and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customers account before recording a cash receipt. 5. Total each of the columns of the special journals, and post the individual entries and totals to the general ledger. Insert account balances after the last posting. 6. Determine that the sum of the customer accounts agrees with the accounts receivable controlling account in the general ledger. 7. Why would an automated system omit postings to a control account as performed in step 5 for Accounts Receivable?arrow_forward
- Transactions related to revenue and cash receipts completed by Sycamore Inc. during the month of March 20Y8 are as follows: Prepare a single-column revenue journal and a cash receipts journal to record these transactions. Use the following column headings for the cash receipts journal: Fees Earned Cr., Accounts Receivable Cr., and Cash Dr. Place a check mark () in the Post. Ref. column to indicate when the accounts receivable subsidiary ledger should be posted.arrow_forwardTransactions related to revenue and cash receipts completed by Albany Architects Co. during the period November 230, 2016, are as follows: Instructions 1. Insert the following balances in the general ledger as of November 1: 2. Insert the following balances in the accounts receivable subsidiary ledger as of November 1: 3. Prepare a single-column revenue journal (p. 40) and a cash receipts journal (p. 36). Use the following column headings for the cash receipts journal: Fees Earned Cr., Accounts Receivable Cr., and Cash Dr. The Fees Earned column is used to record cash fees. Insert a check mark () in the Post. Ref. column when recording cash fees. 4. Using the two special journals and the two-column general journal (p. 1), journalize the transactions for November. Post to the accounts receivable subsidiary ledger, and insert the balances at the points indicated in the narrative of transactions. Determine the balance in the customers account before recording a cash receipt. 5. Total each of the columns of the special journals, and post the individual entries and totals to the general ledger. Insert account balances after the last posting. 6. Determine that the sum of the customer balances agrees with the accounts receivable controlling account in the general ledger. 7. Why would an automated system omit postings to a controlling account as performed in step 5 for Accounts Receivable?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
- Happy Tails Inc. has a September 1, 20Y4, accounts payable balance of 620, which consists of 320 due Labradore Inc. and 300 due Meow Mart Inc. Transactions related to purchases and cash payments completed by Happy Tails Inc. during the month of September 20Y4 are as follows: a. Prepare a purchases journal and a cash payments journal to record these transactions. The forms of the journals are similar to those used in the text. Place a check mark () in the Post. Ref. column to indicate when the accounts payable subsidiary ledger should be posted. Happy Tails Inc. uses the following accounts: b. Prepare a listing of accounts payable creditor balances on September 30, 20Y4. Verify that the total of the accounts payable creditor balances equals the balance of the accounts payable controlling account on September 30, 20Y4. c. Why does Happy Tails Inc. use a subsidiary ledger for accounts payable?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_forwardMaddie Inc. has the following transactions for its first month of business. A. What are the individual account balances, and the total balance, in the accounts receivable subsidiary ledger? B. What is the balance in the accounts receivable general ledger (control) account?arrow_forward
- The revenue and cash receipts journals for Mirage Productions Inc. follow. The accounts receivable control account has a August 1, 2016, balance of 4,230 consisting of an amount due from Celestial Studios Inc. Prepare a listing of the accounts receivable customer balances and verify that the total agrees with the ending balance of the accounts receivable controlling account.arrow_forwardThe transactions completed by the MJW Company during January, its first month of operations, are listed below. Assume that MJW Company uses the following journals: Cash Receipts (CR), Cash Payments (CP), Revenue (R), Purchases (P), and General (G). Assume that it uses an Accounts Receivable and an Accounts Payable Subsidiary Ledgers as well as a General Ledger. Indicate by letters which journal would be used to record each transaction (a journal may be used multiple times). Also, indicate with a “Yes” (in the “Posting” column) if recording the entry requires a posting to a subsidiary ledger (note: there are only 5 of the 10 that require a posting to the subsidiary ledger). Journal Posting _____ ____ (1) Purchased equipment on account. _____ ____ (2) Issued an invoice to a customer. _____ ____ (3) Received a check from a customer for payment on account. _____ ____ (4) Issued check for advertising expense. _____ ____…arrow_forwardes Identify the source document for NDX Company in each of the following accounting processes. Accounting processes a. A customer purchases merchandise with a credit card. NDX uses the electronic sales receipt to record transaction details in its accounting system. b. NDX purchases goods and receives a bill from the supplier. Details from the bill are captured and entered in the accounting database, which is stored in the cloud. c. An NDX employee receives a bank statement each month on her company e-mail. The statement is used to record bank fees incurred for that month. Source documents Credit card Bill from supplier Bank statementarrow_forward
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