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7 EXERCISES: Chapter SET B E7-1B Gill Company uses both special journals and a general journal as described in this chapter. On June 30, after all monthly postings had been completed, the Accounts Receivable control account in the general ledger had a debit balance of $200,000; the Accounts Payable control account had a credit balance of $120,000. The July transactions recorded in the special journals are summarized below. No entries affecting accounts receivable and accounts payable were recorded in the general journal for July. Sales journal Purchases journal Cash receipts journal Cash payments journal Total sales $252,000 Total purchases $151,000 Accounts receivable column total $231,000 Accounts payable column total $142,000 Determine control account balances, and explain posting of special journals. (SO 2, 4) Instructions (a) What is the balance of the Accounts Receivable control account after the monthly postings on July 31? (b) What is the balance of the Accounts Payable control account after the monthly postings on July 31? (c) To what account(s) is the column total of $252,000 in the sales journal posted? (d) To what account(s) is the accounts receivable column total of $231,000 in the cash receipts journal posted? E7-2B Presented below is the subsidiary accounts receivable account of Maxwell Shafer. Explain postings to subsidiary ledger. (SO 2) Date 2010 Sept. 4 7 23 Ref. S29 G4 CR9 Debit 16,000 Credit Balance 16,000 14,000 2,000 14,000 Instructions Write a memo to Tyler Johnston, chief financial officer, that explains each transaction. E7-3B On September 1 the balance of the Accounts Receivable control account in the general ledger of Harland Company was $12,960. The customers subsidiary ledger contained account balances as follows: Garcia $1,940, Verduzco $3,140, Bautista $2,560, Campione $5,320. At the end of September the various journals contained the following information. Sales journal: Sales to Bautista $900; to Garcia $1,400; to Miranda $1,500; to Campione $1,200. Cash receipts journal: Cash received from Bautista $1,610; from Campione $2,600; from Miranda $580; from Verduzco $2,100; from Garcia $1,540. General journal: An allowance is granted to Campione $325. Instructions (a) Set up control and subsidiary accounts and enter the beginning balances. Do not construct the journals. (b) Post the various journals. Post the items as individual items or as totals, whichever would be the appropriate procedure. (No sales discounts given.) (c) Prepare a list of customers and prove the agreement of the controlling account with the subsidiary ledger at September 30, 2008. E7-4B Yaspo Company has a balance in its Accounts Receivable control account of $17,000 on January 1, 2010. The subsidiary ledger contains three accounts: James Company, balance $6,000; Black Company, balance $3,700; and Change Company. During January, the following receivable-related transactions occurred. Determine control and subsidiary ledger balances for accounts receivable. (SO 2) Post various journals to control and subsidiary accounts. (SO 2, 4) Credit Sales James Company Black Company Change Company $14,000 11,000 13,000 Collections $12,000 4,000 14,000 Returns $ -04,500 -0- 34 Chapter 7 Accounting Information Systems Instructions (a) What is the January 1 balance in the Change Company subsidiary account? (b) What is the January 31 balance in the control account? (c) Compute the balances in the subsidiary accounts at the end of the month. (d) Which January transaction would not be recorded in a special journal? Determine control and subsidiary ledger balances for accounts payable. (SO 2) E7-5B Fatal End Company has a balance in its Accounts Payable control account of $11,600 on January 1, 2010. The subsidiary ledger contains three accounts: Smythe Company, balance $4,200; Bleu Company, balance $2,600; and Polinski Company. During January, the following receivablerelated transactions occurred. Purchases Smythe Company Bleu Company Polinski Company $9,500 7,350 8,900 Payments $8,400 2,600 9,500 Returns $ -03,100 -0- Instructions (a) What is the January 1 balance in the Polinski Company subsidiary account? (b) What is the January 31 balance in the control account? (c) Compute the balances in the subsidiary accounts at the end of the month. (d) Which January transaction would not be recorded in a special journal? Record transactions in sales and purchases journal. (SO 2, 3) E7-6B Roberta Company uses special journals and a general journal.The following transactions occurred during September 2010. Sept. 2 Sold merchandise on account to R. Sears, invoice no. 101, $900, terms n/30. The cost of the merchandise sold was $540. 10 Purchased merchandise on account from M. Stoltz $800, terms 2/10, n/30. 12 Purchased office equipment on account from C. Cottrain 7,000. 21 Sold merchandise on account to W. Citel, invoice no. 102 for $1,000, terms 2/10, n/30. The cost of the merchandise sold was $600. 25 Purchased merchandise on account from W. Corek $1,200, terms n/30. 27 Sold merchandise to K. Salma for $850 cash. The cost of the merchandise sold was $510. Instructions (a) Prepare a sales journal (see Illustration 7-6) and a single-column purchase journal (see Illustration 7-13). (Use page 1 for each journal.) (b) Record the transaction(s) for September that should be journalized in the sales journal and the purchases journal. Record transactions in cash receipts and cash payments journal. (SO 2, 3) E7-7B Miramar Co. uses special journals and a general journal. The following transactions occurred during May 2010. May 1 2 3 14 16 22 F. Zaimer invested $30,000 cash in the business. Sold merchandise to B. Counder for $3,800 cash. The cost of the merchandise sold was $2,500. Purchased merchandise for $4,300 from S. Trader using check no. 101. Paid salary to G. Waldorf $450 by issuing check no. 102. Sold merchandise on account to F. Etondo for $550, terms n/30. The cost of the merchandise sold was $350. A check of $5,400 is received from M. Reedy in full for invoice 101; no discount given. Instructions (a) Prepare a multiple-column cash receipts journal (see Illustration 7-9) and a multiplecolumn cash payments journal (see Illustration 7-16). (Use page 1 for each journal.) (b) Record the transaction(s) for May that should be journalized in the cash journal receipts and cash payments journal. Exercises: Set B E7-8B Gadle Company uses the columnar cash journals illustrated in the textbook. In April, the following selected cash transactions occurred. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Received cash refund from supplier for merchandise returned. Received collection from customer within the 3% discount period. Made cash sales. Paid a creditor within the 3% discount period. Received collection from customer after the 3% discount period had expired. Paid freight on merchandise purchased. Paid cash for office equipment. Made a refund to a customer for return of damaged goods. Withdrew cash for personal use of owner. Purchased merchandise for cash. 35 Explain journalizing in cash journals. (SO 3) Instructions Indicate (a) the journal, and (b) the columns in the journal that should be used in recording each transaction. E7-9B Lanier Company has the following selected transactions during March. Mar. 2 5 7 Purchased equipment costing $7,500 from Tuan Company on account. Received credit of $350 from Ramp Company for merchandise damaged in shipment to Lanier. Issued credit of $300 to Red Company for merchandise the customer returned. The returned merchandise had a cost of $200. Journalize transactions in general journal and post. (SO 2, 4) Lanier Company uses a one-column purchases journal, a sales journal, the columnar cash journals used in the text, and a general journal. Instructions (a) Journalize the transactions in the general journal. (b) In a brief memo to the president of Lanier Company, explain the postings to the control and subsidiary accounts from each type of journal. E7-10B Below are some typical transactions incurred by Koyama Company. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. Return of merchandise sold for credit. Payment of creditors on account. Collection on account from customers. Sale of merchandise on account. Sale of land for cash. Sale of merchandise for cash. Received credit for merchandise purchased on credit. Payment of employee wages. Sales discount taken on goods sold. Income summary closed to owners capital. Purchase of office supplies for cash. Depreciation on building. Purchase of merchandise on account. Indicate journalizing in special journals. (SO 3) Instructions For each transaction, indicate whether it would normally be recorded in a cash receipts journal, cash payments journal, sales journal, single-column purchases journal, or general journal. E7-11B The general ledger of Mancha Company contained the following Accounts Payable control account (in T-account form). Also shown is the related subsidiary ledger. Explain posting to control account and subsidiary ledger. (SO 2, 4) GENERAL LEDGER Accounts Payable Feb. 15 General journal 28 ? 1,900 ? Feb. 1 5 11 28 Balance General journal General journal Purchases 29,500 400 700 55,000 31,000 Feb. 28 Balance 36 Chapter 7 Accounting Information Systems ACCOUNTS PAYABLE LEDGER Huang Feb. 28 Bal. 16,400 Luang Feb. 28 Bal. ? Le Feb. 28 Bal. 3,200 Instructions (a) Indicate the missing posting reference and amount in the control account, and the missing ending balance in the subsidiary ledger. (b) Indicate the amounts in the control account that were dual-posted (i.e., posted to the control account and the subsidiary accounts). E7-12B Selected accounts from the ledgers of April Company at July 31 showed the following. Prepare purchases and general journals. (SO 2, 3) GENERAL LEDGER Store Equipment Date July 1 Date July 1 15 18 25 31 Explanation Explanation Ref. G1 Ref. G1 G1 G1 G1 P1 Debit 3,500 Debit Credit 3,500 500 120 180 7,350 Credit No. 153 Balance 3,500 No. 201 Balance 3,500 4,000 3,880 3,700 11,050 Date July 15 18 25 31 Merchandise Inventory Explanation Ref. G1 G1 G1 P1 Debit 500 120 180 7,350 Credit No. 120 Balance 500 380 200 7,550 Accounts Payable ACCOUNTS PAYABLE LEDGER Alma Equipment Co. Date July 1 Explanation Ref. G1 Debit Credit 3,500 Balance 3,500 Date July 14 25 Date July 12 21 Date July 15 Explanation Explanation Explanation Duffy Co. Ref. P1 G1 Ref. P1 P1 Debit 180 Debit Credit 400 550 Debit Credit 500 Credit 950 Balance 950 770 Balance 400 950 Balance 500 Buntz Co. Date July 3 20 Date July 17 18 29 Explanation Explanation Ref. P1 P1 Debit Credit 2,200 600 Debit 120 1,400 Credit 1,250 Balance 2,200 2,800 Balance 1,250 1,130 2,530 Earnhart Co. Cirillo Corp. Ref. P1 G1 P1 Fleche Inc. Ref. G1 Instructions From the data prepare: (a) the single-column purchases journal for July. (b) the general journal entries for July. E7-13B Pest Products uses both special journals and a general journal as described in this chapter. Pest also posts customers accounts in the accounts receivable subsidiary ledger. The postings for the most recent month are included in the subsidiary T accounts on the next page. Determine correct posting amount to control account. (SO 4) Exercises: Set B West Bal. 500 300 375 Bal. 37 Plante 225 360 225 Wyoming Bal. 0 210 210 Bal. Wells 180 290 225 180 Instructions Determine the correct amount of the end-of-month posting from the sales journal to the Accounts Receivable control account. E7-14B Selected account balances for Moby Dick Company at January 1, 2010, are presented below. Compute balances in various accounts. (SO 4) Accounts Payable Accounts Receivable Cash Inventory $22,000 29,000 20,000 18,000 Moby Dicks sales journal for January shows a total of $120,000 in the selling price column, and its one-column purchases journal for January shows a total of $83,000. The column totals in Moby Dicks cash receipts journal are: Cash Dr. $81,000; Sales Discounts Dr. $2,000; Accounts Receivable Cr. $50,000; Sales Cr. $12,000; and Other Accounts Cr. $17,000. The column totals in Moby Dicks cash payments journal for January are: Cash Cr. $70,000; Inventory Cr. $2,000; Accounts Payable Dr. $58,000; and Other Accounts Dr. $13,000. Moby Dicks total cost of goods sold for January is $80,000. Accounts Payable, Accounts Receivable, Cash, Inventory, and Sales are not involved in the Other Accounts column in either the cash receipts or cash payments journal, and are not involved in any general journal entries. Instructions Compute the January 31 balance for Moby Dick in the following accounts. (a) Accounts Payable. (b) Accounts Receivable. (c) Cash. (d) Inventory. (e) Sales. ... View Full Document

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