• April 14th, 2016

Special Journals

Paper, Order, or Assignment Requirements

Must be done on an excel sheet

Completing accounting cycle for a merchandising entity – using special Journals.

A-1 Networking systems adjusts and closes its books and then prepares financial statements monthly. A-1 uses the perpetual inventory system. The company completed the following transactions during august:

Aug1. Issued check# 682 for August office rent of $1,000.
2. Issued check# 683 to pay the salaries payable of $1,250 from july 31.
2. Issued invoice# 503 for sale on account to R.T. Loeb, $600. A-1’s cost of this merchandise inventory was $190.
3. Purchased merchandise inventory on credit terms of 1/15, n/60 from Grant, Inc., $1400.
4. Received net amount of cash on account from Fullam Company, $2,156, within the discount period.
4. Sold merchandise inventory for cash, $330 (cost $104).
5. Received from Park-Hee, Inc. merchandise inventory that had been sold earlier for $550 (cost $174)
5. Issued check# 684 to purchase office supplies for cash, $780.
7. Issued invoice# 504 for sale on account to K.D. Skipper, $2,400 (cost $759).
8. Issued check# 685 to pay Federal Company $2,600 of the amount owed at the July 31. This payment occurred after the end of the discount period.
11. Issued check# 686 to pay Grant, Inc. the net amount owed from august 3.
12. Received cash from R.T. Loeb in full settlement of her account receivable from august 2.
16. Issued check# 687 to pay the salaries expense of $1,240.
19. Purchased merchandise inventory for cash, $850, issuing check# 688.
22. Purchased furniture on credit terms of 3/15, n/60 from Beaver Corporation, $510.
23. Sold merchandise inventory on account to Fullam Company, issuing invoice# 505 for $9,966 (cost $3,152)
24. Received half the July 31 amount receivable from K.D. Skipper- after the end of the discount period.
26. Purchased office supplies on credit terms of 2/10, n/30 from Federl Company, $180.
30. Returned damaged merchandise inventory to company from whom A-1 the cash purchase on August 19, receiving cash of $850.
31. Purchased merchandise inventory on credit terms of 1/10, n/30 from Suncrest Supply, $8,330.
31. Issued check# 689 to stockholders, for dividends, $1,700.

*REQUIREMENTS:

1. Open these four-column accounts with their account numbers and July 31 balances in the various ledgers.

General Ledger

101 Cash $4,490
102 Accounts Receivables 22,560
105 Merchandise inventory 41,800
109 Office Supplies 1,340
117 Prepaid Insurance 2,200
160 Furniture 37,270
161 Accumulated Depreciation- furniture $10,500
201 Accounts payable 12,600
204 Salaries Payable 1,250
220 Note Payable, Long term 31,000
301 Common Stock 25,000
305 Retained Earnings 29,260
310 Dividends
400 Income Summary
401 Sale Revenue
402 Sale Discounts
403 Sales Returns and allowances
501 Cost of goods sold
510 Salaries Expense
513 Rent Expense
514 Depreciation Expense- furniture
516 Insurance Expense
519 Supplies Expense

Accounts receivable Subsidiary Ledger: Fullham Company $2,200; R.T. Loeb $0; Park-Hee, Inc. $11,590; K.D. Skipper $8,770.
Accounts Payable Subsidiary Ledger: Beaver Corporation $0; Federal Company $12,600; Grant, Inc. $0; Suncrest Supply $0.

2. Journalize The August trasnsactions in a series of special journals: a sales journal, a cash receipts journal, a purchase journal, a cash payments journal and a general journal. A-1 makes all credit sales on terms of 2/10, n/30.

3. Post daily to the accounts receivable subsidiary ledger and the accounts payable subsidiary ledger. On August 31, post to the general ledger.

4. Prepare an unadjusted trial balance for the month ended August 31.

5. Journalize and post the following adjusting entries:
a. Office supplies on hand, $990.
b. Prepaid insurance expired, $550.
c. Depreciation expense, $230.
d. Accrued salaries expense, $1,030.

6. Prepare an adjusted trial balance.

7. Prepare a multistep income statement, statement of retained earnings, and classified balance sheet.

8. Journalize closing entries and post.

9. Prepare a post closing trial balance.

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