Accounting Information Systems

On April 1, the accounts receivable ledger of Kozma Company showed the following balances: Morrow $1,550, Rose $1,200, Jennings Co. $2,900, and Dent $2,200. The April transactions involving the receipt of cash were as follows.

Instructions

1. Journalize the transactions above in a six-column cash receipts journal with columns for Cash Dr., Sales Discounts Dr., Accounts Receivable Cr., Sales Revenue Cr., Other Accounts Cr., and Cost of Goods Sold Dr/Inventory Cr. Foot and cross-foot the journal.
2. Insert the beginning balances in the Accounts Receivable control and subsidiary accounts, and post the April transactions to these accounts.
3. Prove the agreement of the control account and subsidiary account balances.

Solution

On October 1, the accounts payable ledger of Reineke Company showed the following balances: Uggla Company $2,700, Orr Co. $2,500, Rosenthal Co. $1,800, and Clevenger Company $3,700. The October transactions involving the payment of cash were as follows.

Instructions

1. Journalize the transactions above in a four-column cash payments journal with columns for Other Accounts Dr., Accounts Payable Dr., Inventory Cr., and Cash Cr. Foot and cross-foot the Journal.
2. Insert the beginning balances in the Accounts Payable control and subsidiary accounts, and post the October transactions to these accounts.
3. Prove the agreement of the control account and subsidiary account balances.

Solution

In July the following selected transactions were completed. All purchases and sales were on account. The cost of all merchandise sold was 70% of the sales price.

Instructions

1. Journalize the transactions above in a purchased journal, a sales journal, and a general journal. The purchases journal should have the following column headings: Date, Account Credited (Debited), Ref., Accounts Payable Cr., Inventory Dr., and Other Accounts Dr.
2. Post to both the general and subsidiary ledger accounts. (Assume that all accounts have zero beginning balances.)
3. Prove the agreement of the control and subsidiary accounts.

Solution

The cost of all merchandise sold was 60% of the sales price. During January, Mercer completed the following transactions.

1. Sales journal.
2. Single-column purchases journal.
3. Cash receipts journal with columns for cash Dr., Sales Discounts Dr., Accounts Receivable Cr., Sales Revenue Cr., Other Accounts Cr., Cost of Goods Sold Dr., and Inventory Cr.
4. Cash payments journal with columns for Other Accounts Cr., Accounts Payable Dr., Inventory Cr., and Cash Cr.
5. General journal.

Instructions

1. Record the January transactions in the appropriate journal noted
2. Foot and cross-foot all special journals.
3. Show how postings would be made by placing ledger account numbers and check-marks as needed in the journals. (Actual posting to ledger accounts is not required.)

Solution

Instructions

1. Open the following accounts in the general ledger
   101 Cash
   112 Accounts Receivable
   120 Merchandise Inventory
   126 Supplies
   131 Prepaid Rent
   201 Accounts Payable
   301 Owner's Capital

   306 Owner's Drawings
   401 Sales Revenue
   414 Sales Discounts
   505 Cost of Goods Sold
   631 Supplies Expense
   729 Rent Expense
2. Journalize the transactions that have not been journalized in the sales journal and the cash receipts journal.
3. Post to the accounts receivable and accounts payable subsidiary ledgers. Follow the sequence of transactions as shown in the problem.
4. Post the individual entries and totals to the general ledger.
5. Prepare a trial balance at July 31, 2020
6. Determine whether the subsidiary ledgers agree with the control accounts in the general ledger.
7. The following adjustments at the end of July are necessary.
   
   1. A count of supplies indicates that $140 is still on hand.
   2. Recognize rent expense for July, $500.
   Prepare the necessary entries in the general journal. Post the entries to the general ledger.
8. Prepare an adjusted trial balance at July 31, 2020

Solution

The transactions for January 2010 are as follows

Instructions

1. Open general and subsidiary ledger accounts for the following.
   101 Cash
   112 Accounts Receivable
   115 Notes Receivable
   120 Merchandise Inventory
   157 Equipment
   158 Accumulated Depreciation-Equipment
   200 Notes Payable
   201 Accounts Payable

   301 Owner's Capital
   401 Sales Revenue
   412 Sales Returns and Allowances
   414 Sales Discounts
   505 Cost of Goods Sold
   726 Salaries and Wages Expense
   729 Rent Expense
2. Record the January transactions in a sales journal, a single-column purchases journal, a cash receipts journal, a cash payments journal, and a general journal.
3. Post the appropriate amounts to the general ledger.
4. Prepare a trial balance at January 31, 2020
5. Determine whether the subsidiary ledgers agree with controlling accounts in the general ledger.

Solution

Nex Company uses both special journals and a general journal. On June 30, after all monthly postings had been completed, the Accounts Receivable control account in the general ledger had a debit balance of $340,000, the Accounts Payable control account had a credit balance of $77,000.

Instructions

1. What is the balance of the Accounts Receivable control account after the monthly postings on July 31?
2. What is the balance of the Accounts Payable control account after the monthly postings on July 31?
3. To what account(s) is the column total of $161,400 in the sales journal posted?
4. To what account(s) is the accounts receivable column total of $131,000 in the cash receipts journal posted?

Solution

Instructions

Solution

On September 1, the balance of the accounts Receivable control account in the general ledger of Montgomery company was $10,960. The customers' subsidiary ledger contained account balance as follows: Hurley $1,440, Andino $2,640, Fowler $2,060, and Sogard $4,820. At the end of September, the various journals contained the following information.

Sales journal: Sales to Sogard $800, to Hurley $1,260, to Giambi $1,330, and to Fowler $1,600

Cash Receipt journal: Cash received from Fowler $1,310, from Sogard $3,300, from Giami $380, from Andino $1,800, and from Hurley $1,240.

General Journal journal: An allowance is granted to Sogard $220.

Instructions

1. Set up control and subsidiary accounts and enter the beginning balances. Do not construct the journals
2. Post the various journals. Post the items as individual items or as totals, whichever would be the appropriate procedure. (No sales discounts given.)
3. Prepare a schedule of accounts receivable and prove the agreement of the controlling account with the subsidiary ledger at September 30, 2019.

Solution

Instructions

1. What is the January 1 balance in the Freeze company subsidiary account?
2. What is the January 31 balance in the control account?
3. Compute the balances in the subsidiary accounts at the end of the month.
4. Which January transaction would not be recorded in a special Journal?

Solution