Ali Co. uses a sales journal, a purchases journal, a cash receipts journal, a ca

Question

Ali Co. uses a sales journal, a purchases journal, a cash receipts journal, a cash disbursements journal, and a general journal. The following transactions occur in the month of November. Nov. 3 The company purchased $3,200 of merchandise on credit from Hart Co. terms n/20. 7 The company sold merchandise costing $840 on credit to J. Than for $1,000, subject to a $20 sale discount if paid by the end of the month. 9 The company borrowed $3,750 cash by signing a note payable to the bank. 13 J. Ali, the owner, contributed $5,000 cash to the company. 18 The company sold merchandise costing $250 to B. Cox for $330 cash. 22 The company paid Hart Co. $3,200 cash for the merchandise purchased on November 3. 27 The company received $980 cash from J. Than in payment of the November 7 purchase. 30 The company paid salaries of $1,650 in cash. Prepare headings for a cash receipts journal like the one in exhibit 7.7 (Principles of Financial Accounting Ed. 22 Wild). Journalize the November transactions that should be recorded in the cash receipts journal.

Explanation / Answer

Date Particulars Debit Credit Nov.3 Purchases A/c Dr. $3200 To Hart & Co. $3200 Nov.7 J A/c Dr. $1000 To Sale A/c $1000 Nov.9 Cash A/c Dr. $3750 To Bank Loan $3750 Nov.13 Cash A/c Dr. $5000 To Capital A/c $5000 Nov.18 Cash A/c Dr. $330 To Sales $330 Nov.22 Hart & co. A/c Dr. $3200 To Cash A/c $3200 Nov.27 Cash A/c Dr. $980 Discount A/c Dr. $20 To J A/c Dr. $1000 Nov.30 Salaries A/c Dr. $1650 To Cash $1650

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