Palisade Creek Co. is a merchandising business that uses the perpetual inventory
ID: 2447473 • Letter: P
Question
Palisade Creek Co. is a merchandising business that uses the perpetual inventory system. The account balances for Palisade Creek Co. as of May 1, 2016 (unless otherwise indicated), are as follows:
During May, the last month of the fiscal year, the following transactions were completed:
Record the following transactions on page 20 of the journal. Refer to the Chart of Accounts for exact wording of account titles.
Record the following transactions on page 21 of the journal. Refer to the Chart of Accounts for exact wording of account titles.
Paid for purchase of May 21, less return of May 24.
110 Cash $ 83,600 112 Accounts Receivable 233,900 115 Merchandise Inventory 624,400 116 Estimated Returns Inventory 28,000 117 Prepaid Insurance 16,800 118 Store Supplies 11,400 123 Store Equipment 569,500 124 Accumulated Depreciation-Store Equipment 56,700 210 Accounts Payable 96,600 211 Salaries Payable — 212 Customers Refunds Payable 50,000 310 Common Stock 100,000 311 Retained Earnings 585,300 312 Dividends 135,000 313 Income Summary — 410 Sales 5,069,000 510 Cost of Merchandise Sold 2,823,000 520 Sales Salaries Expense 664,800 521 Advertising Expense 281,000 522 Depreciation Expense — 523 Store Supplies Expense — 529 Miscellaneous Selling Expense 12,600 530 Office Salaries Expense 382,100 531 Rent Expense 83,700 532 Insurance Expense — 539 Miscellaneous Administrative Expense 7,800Explanation / Answer
Merchandise Inventory
Accounts Payable—Martin Co.
Accounts Receivable—Korman Co
Cost of Merchandise Sold
Accounts Receivable—Halstad Co.
Date Description Debit Credit May 1 2014 Rent Expenses 531 5000 Cash 110 5000 May 3Merchandise Inventory
115 36,000Accounts Payable—Martin Co.
110 36,000 May 4 Merchandise Inventory 115 600 cash 110 600 May 6Accounts Receivable—Korman Co
112 68,500 Sales 410 68,500 may 6Cost of Merchandise Sold
510 41,000 merchandise inventory 115 41,000 may 7 Cash 110 22,300Accounts Receivable—Halstad Co.
112 22,300 May 10 Cash 110 54,000 Sales 410 54,000 May 11cost of merchandise sold 510 32,000 Merchandise inventory 110 32,000
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